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"El Mutún is not halted as some have said"

Freddy Beltrán

Mining director/Mines and metallurgy ministry

Published  Friday, October 16, 2009

Indian company Jindal Steel & Power, which is developing the El Mutún iron ore deposit in Bolivian department Santa Cruz, recently announced that it intends to request that changes be made to the JV contract with the state for development of the project.

Jindal has also expressed concern that it still does not hold all the land for the project established by the contract.

To clear up these and other issues about the development of El Mutún, BNamericas spoke with Bolivian mining director Freddy Beltrán.

BNamericas: Recently, a Bolivian government official said that problems with the purchase of properties for the El Mutún project have created a legal gap since these properties still have not been transferred to Jindal. Is this true?

Beltrán: No, this isn't true. The properties have already been formerly transferred. I was recently in the area and Jindal has already placed signs marking different areas where work will be carried out.

There is just one property where we are involved in a lengthy expropriation process and we haven’t yet been able to reach an agreement. But in general, property issues started to be sorted out a long time ago. In fact Jindal has already been mining for quite some time now. If it weren’t so then not a single part of this project would have been completed.

BNamericas: In other words Jindal already has decided where its plants, camps and pits will go?

Beltrán: Of course. The area where this company is currently mining is very large and also very far from the sites where conflicts supposedly still exist.

BNamericas: Is this mining work where the several tons of iron that the company has ready for exportation came from?

Beltrán: That's right. This iron is part of the early production that is established by the contract. Jindal is allowed to mine and export these concentrates, and this is what they are working on.

BNamericas: So this iron has already been stored and is ready for exportation?

Beltrán: Yes, we have verified that Jindal has stored this material in two or three different areas and both of the two mobile crushers are up and running, so indeed mining operations are going well. The process is underway and this is a good sign, for us and for them.

El Mutún is not halted as some have said.

Once the board of the JV company formed between us [state miner Comibol and state steelmaker Esem] and Jindal holds another meeting and we approve the work plan Jindal made, which includes data on production and the investments, Jindal will be able to export to the markets it has chosen.

BNamericas: This plan has been rejected twice for being incomplete, right?

Beltrán: Yes, we made some observations and Jindal is aware of these. We hope that these observations have been considered in the new work plan and that we can reach an agreement and that everything will fit the contract’s framework.

BNamericas: When do you expect Jindal to submit the revised plan?

Beltrán: The plan is expected to be presented during the next JV board meeting, but a date hasn’t been set yet. Jindal's chairman must set the date for this meeting.

We visited Jindal's headquarters in Puerto Suárez with mining minister Alberto Echazú to encourage the company to set a date for this meeting as soon as possible. We are both interested in resolving this issue.

BNamericas: But this is exactly the perception of the project, that things are being bogged down because of the lack of a work plan, property issues, the change in Esem presidents and so on. Is this true?

Beltrán: No, the project is not being bogged down at all. Everything is running smoothly. We have met with Jindal delegates and at no point did they ever mention any sort of legal difficulties, not in the least. This is simply untrue.

Yes, a new president was chosen for Esem but the company continues to run normally. In fact, we have tried to avoid allowing any of these difficulties to interfere with development at El Mutún.

BNamericas: On a different note, the government is holding an international lithium conference this month. Is this conference just a forum for discussing the best technology for lithium development or is it also a way to find more potential investors for lithium development?

Beltrán: Yes, this is a technological and scientific conference. Companies and the government will meet to share the significant advances that both have made.

The pilot plant will begin operations next year and as of now has met its entire schedule. We have made some important advances in research as well and these will be announced when the time is right.

Also, within the next few days a technical delegation from Japan will arrive to present the results of its research about lithium development. So, things are going quite well.

BNamericas: Will all of the goals set for this stage of development be met?

Beltrán: Yes, we will reach all of our goals for research and construction, and all of this will happen on time.

BNamericas: Recently Bolivian president Evo Morales said that he would prefer for the country to partner with another government rather than a private company to develop lithium. Has any progress been made on this issue?

Beltrán: The Bolivian state will produce lithium carbonates and we are looking for partners for the second phase of industrialization, the stage that begins after carbonate production.

By doing so, the state can guarantee a carbonate supply.

For the second phase we are evaluating offers from several firms. French company Bollore has promised to issue a written offer for the installation of a lithium battery project here in Bolivia.

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