Dialogues: USA Africa Dialogue Series - Iron-Ore Mining in Liberia by Year-End

Tuesday, September 17, 2013

USA Africa Dialogue Series - Iron-Ore Mining in Liberia by Year-End

Sesa Goa to Start Iron-Ore Mining in Liberia by Year-End

Jindal Steel & Power Signs Initial Pact to Set Up Power Plant in African Nation

MUKESH JAGOTA

NEW DELHI—India's Sesa Goa Ltd., which owns Liberia's Western Clusters project, will start iron-ore mining operation in the African nation by the end of this year, Liberian President Ellen Johnson Sirleaf said Wednesday.

The Western Clusters project has iron-ore resources in excess of one billion metric tons and salable product of 330 million tons. Sesa Goa, a unit of Vedanta Resources PLC, had spent about $123.5 million to purchase the entire stake in the project.

Mrs. Sirleaf, who is on a five-day visit to India, said ArcelorMittal has started exporting iron ore from the West African country. ArcelorMittal currently exports five million tons a year and it plans to expand shipments to 15 million tons in the second phase of its operations, she said.

ArcelorMittal, the world's biggest steelmaker and a large iron-ore producer, started mining iron ore in Liberia in 2011.

Global mining companies and steel producers are flocking to the region to develop large deposits of iron ore and export the raw material used in steelmaking to countries such as China. West African countries, which are rich in mineral resources including iron ore, bauxite, gold and manganese, are seeking to develop their resources with international investors to boost local development and reduce poverty.

Indian iron-ore suppliers such as Sesa Goa are looking to expand overseas as mining in India is hit by court restrictions following investigations into illegal mining. India was the world's third-largest iron-ore exporter until two years ago, but it has now started importing the raw material because of a domestic shortage.

Mrs. Sirleaf said another Indian company, Jindal Steel & Power Ltd., is negotiating with the Liberian government to install a power plant.

Later in the day, Jindal Steel & Power said it signed an initial agreement to set up a 350-megawatt plant in Liberia.

Write to Mukesh Jagota at mukesh.jagota@wsj.com

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