About a year after the Sajjan Jindal-led JSW Steel announced the acquisition of the Minas de Revuboe (MdR) coking coal mine in Mozambique, regulatory hurdles surrounding the deal have been cleared.
About a year after the Sajjan Jindal-led JSW Steel announced the acquisition of the Minas de Revuboe (MdR) coking coal mine in Mozambique, regulatory hurdles surrounding the deal have been cleared.
According to a report by Bloomberg, JSW Steel’s $74 million acquisition of MdR faced a major setback after the previous administration under President Filipe Nyusi cancelled the mining lease.
MdR, owned by Australia's Talbot Group Investments Pty Ltd, challenged the move through legal and arbitration proceedings. Last week, Mozambique’s natural resources database confirmed that the mining concession had been reinstated. This follows a cabinet decision on April 15 by new President Daniel Chapo, who reversed the earlier cancellation of MdR’s mining contract.
“We are pleased with the outcome and thank the government for its leadership,” a spokesperson for the Talbot Group told Bloomberg, adding that efforts are now focused on preparing the project and proceeding with the sale to JSW Steel.
Meanwhile, the Sajjan Jindal-led company, which announced the takeover last May, extended the deal closure deadline by five months in January, shortly after Chapo succeeded Nyusi. In February, the company said it was still pursuing the MdR project, which holds an estimated 280 million tonnes of high-grade coking coal essential for steel production.
JSW’s MD and CEO, Jayant Acharya, explained its significance to analysts in May last year.
“The asset (MdR mine) has reserves and resources in excess of 800 million tonnes, including more than 270 million tonnes of prime coking coal,” he said, adding that MdR is a pre-development stage mine and one of the largest globally available assets for prime hard coking coal.
“Subject to normal approvals and conditions precedent, we expect to close this mine in the second half of the year. Hopefully, we can begin development in FY25. This is prime hard coking coal. As you know, we’ve been looking for such assets both internationally and domestically. This will not only provide us some cushion against the highly volatile PLV index, but it is also logistically closer to India and will help optimise costs,” Acharya said at the time.