JSPL stock down as Bolivia operations suspended

Shares of Jindal Steel & Power (JSPL) were down 2.8 percent after media reported the company has suspended its Bolivia operations.

Operations at its iron ore mine in Bolivia have been suspended as efforts to salvage the troubled project failed, said a report in Wall Street Journal.

The company has “suspended its contractual obligations and informed the government of its intention to terminate the joint venture contract for El Mutun,” the report quoted from a statement from the company.

“El Mutun is a vast iron ore deposit on Bolivia’s border with Brazil estimated to contain 40 billion tons of ore,” the report said.

The company may have to exit the country if the government did not renegotiate the issue of the seizure of $36 million cash guarantee, the report said.

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The company has given a deadline of 8 July for the government.

The $2.1 billion project was the most ambitious of the Naveen Jindal-promoted company.