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Bolivia nearer meeting iron ore export target after Indian deal

LA PAZ, Bolivia, Feb. 15 (UPI) -- Bolivia is nearer to meeting its goal of becoming a major iron ore exporter after agreements reached with an Indian company promised to kick off the trade in March, officials said.

India's Jindal Steel and Power said it will start exporting iron ore concentrate next month after its negotiators and Bolivian government officials resolved differences that had blocked a deal since last year.

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Most of the exports of the iron ore will be from the El Mutun mine, the firm said. "They'll be the first iron-ore exports from Bolivia," said Jindal Bolivia's communications manager Eduardo Prudencio. "One million tons will be exported during the following 12 months," he added.

Jindal Managing Director Naveen Jindal earlier visited the eastern Bolivian province of Santa Cruz to inaugurate the firm's offices, which are under construction in Puerto Suarez, close to the Brazilian border.

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Jindal is repairing a 60-mile road to connect El Mutun with a canal waterway linking the Paraguay and Parana rivers and eventually providing access to the Atlantic Ocean.

Jindal has announced plans to build a steel complex in Puerto Suarez that will eventually process 50 percent of the ore from the mine. Scientific studies say the El Mutun mine holds about 40 billion tons of mineral reserves.

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The company has pledged to contribute toward urban regeneration in the area. Jindal promised the regional authorities it will invest $600 million in the area over the next two years. Current plans call for steel production to begin in 2014.

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Bolivia's negotiations with Jindal go back to a 2007 contract that gave the Indian company rights to mine about half of El Mutun reserves but also committed Jindal to investment of $2.1 billion in the projects.

Problems cropped up after disputes over reported underinvestment by Jindal and delays in the project. An $18 million performance guarantee bond was cashed by the Mining Ministry as a punitive measure against Jindal over the delays.

Officials say Bolivia is also carrying on negotiations with China and South Korea over further mining deals.

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An estimated 50 percent of the world's known lithium reserves lie in remote parts of Bolivia's Andean high-mountain plateau, where some of the world's largest uranium deposits have also been located.

Lithium, a low-density metal used in batteries, is seen as crucial to the auto industry's effort to produce hybrid and electric cars. Competing research programs at automotive companies in Europe, Japan and the United States are busy developing energy-efficient, battery-operated cars as substitutes for gasoline-fired cars.

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A growing global consensus on nuclear power has also ignited interest in Bolivia's uranium deposits.

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