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India’s NMDC in iron-ore mining, exploration deal with Zim company

9th May 2014

By: Ajoy K Das

Creamer Media Correspondent

  

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Indian iron-ore miner NMDC and Zimbabwe government-owned Mosi Oa Tunya Development Company (MOTDC) are to sign a joint venture (JV) agreement to explore and develop mineral assets in the African nation.

The JV agreement will be a follow-up to a memorandum of understanding concluded last year, in terms of which NMDC sought exclusive exploration and mining licences in Zimbabwe, an Indian government official has said.

The collaboration between NMDC and MOTDC has been approved by the Mines Ministries of the respective countries and is part of an initiative to increase cooperation in the mining and mineral sectors discussed in bilateral government-to-government economic diplomatic talks, the official added.

A document outlining the contours of the proposed JV has been circulated among the board of directors of NMDC and MOTDC as well as the Mines Ministries of the governments of India and Zim-babwe, with the equity participation of the two countries in the JV company expected to be firmed up shortly, the official says.

The Zimbabwe venture is part of NMDC’s strategy to diversify its overseas mineral resource portfolio and to meet raw material demand from the metallurgical industry in India.

India’s largest iron-ore miner has also initiated a small project for mining and processing gold in Tanzania. In 2012, Tanzania’s Minerals and Energy Ministry granted the miner a mining lease for the Bulyang’Ombe gold reserves.

NMDC has also completed a due diligence investigation of a coal block in the Sumatra province of Indonesia, currently owned by Shree Renuka Sugars, with the latter putting the block on sale last year.

In 2011, the iron-ore miner bought a controlled equity stake in Australian Legacy Iron Ore.

The Indian miner, with free cash reserves of around $3.4-billion on its balance sheet, has firmed up a capital expenditure in domestic and overseas markets of about $736-million during 2014/15, up from $442-million in the previous fiscal.

Edited by Martin Zhuwakinyu
Creamer Media Magazine Managing Editor

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