Saturday, June 15, 2024

JSW Steel invests around 74 million dollars to acquire coal mine in Mozambique

JSW Steel, the Indian steel giant, has announced that its board of directors has approved the acquisition of Minas de Revuboe (MDR), a mining company located in Mozambique. The aim of the purchase is to guarantee a continuous supply of high-quality coal, which is essential for steel production, as reported by the international news portal Sarkaritel.

According to information from a presentation to investors, JSW Steel, led by Sajjan Jindal, revealed that its subsidiary, JSW Natural Resources Limited, will acquire a 92.19% stake and MDR’s shareholder loans for a total value of 4.6 billion meticais (73.75 million dollars).

This transaction will give the Indian company access to more than 800 metric tons of premium coal reserves in Mozambique. MDR owns a large-scale, high quality hard coking coal mine project in the pre-development phase, located in the Moatize Basin in Tete province.

The conclusion of the deal is subject to approval by the Ministry of Mineral Resources and Energy and other necessary approvals.

Indian steel companies consume around 70 million metric tons of coking coal annually, with approximately 85% of this demand being met by imports due to the shortage of the commodity in the country. Coal is mainly imported from Australia, Indonesia, Russia, the USA and Canada.

In recent months, metallurgical coal prices have increased, negatively impacting the financial results of steel companies.

This strategic move by JSW Steel aims to guarantee a stable, high-quality source of coking coal, which is essential for maintaining competitiveness in the global steel market.

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