KOLKATA – Indian iron ore miner NMDC Limited and Zimbabwean government-owned Mosi oa Tunya Development Company (MOTDC) would sign a joint venture (JV) agreement to explore and develop mineral assets in the African country.
The JV agreement was a follow-up to a memorandum of understanding (MoU) concluded last year, in which NMDC sought exclusive exploration and mining rights of mineral assets in Zimbabwe, an Indian government official said.
The collaboration of NMDC and MOTDC had been approved by the Mines ministries of the respective countries as it was part of an initiative to increase co-operation in 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 have been circulated among the board of directors of NMDC and MOTDC as well as Mines ministries of the government of India and Zimbabwe with the equity participation of the two countries in the JV company expected to be firmed up shortly, the official said.
The Zimbabwean venture was part of NMDC’s strategy to diversify its overseas mineral resource portfolio and to meet raw material demand for 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 mining lease for the Bulyang gold reserves. NMDC also completed due diligence of a coal bock in 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 controlled equity stake in Australian Legacy Iron Ore Limited.
The Indian miner with a 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 to 2015, up from $442 million in the previous fiscal.