KABUL - Afghanistan has awarded the rights to develop four blocks at the Hajigak iron ore mine to a group of Indian firms and a Canadian company, the mines ministry said on Tuesday.
The rights of B, C and D blocks have been given to the AFISCO -- an Indian consortium of seven companies, led by the Steel Authority of India Limited (SAIL), and a fourth block called "A" to Canada's Kilo Goldmines Ltd, the Ministry of Mines said.
Led by SAIL, the Indian consortium won the bid for the three blocks and the Kilo Goldmines was awarded the right to develop a fourth block of the mine in central Bamyan province.
The blocks are estimated to hold more than 1.8 billion tons of iron ore, enough to feed a six-million tone steel plant for four decades, the statement said.
The Indian consortium includes three state-run firms - SAIL, National Mineral Development Corporation and Rashtriya Ispat Nigam. It also includes four private steelmakers - JSW Steel, JSW Ispat, Jindal Steel and Power and Monnet Ispat.
The consortium will develop the mine, build a seven-million tone steel plant and an 800mw power plant. The Indian syndicate will be allotted coking coal from Shabasha for steelmaking, according to Abdul Jalil Jumriany, policy director at the ministry.
While SAIL is the largest stakeholder with a 20 percent holding in the consortium, RINL and NMDC hold 18 percent each. JSW Steel and Jindal Steel have 16 percent each. JSW Ispat owns right percent of stake and Monnet Ispat has four percent.
Kilo Goldmines Ltd is a Canada-based company focused on gold exploration in the Democratic Republic of Congo (DRC).
Expression of interest letters were received from about 22 mine companies and after evaluation of six proposals, the winning companies were named.
Minister of Mines Wahidullah Shahrani said: "AFISCO brings a tremendous array of expertise, technical, financial and physical resources, mining and steel production experience developed over more than 100 years in India and internationally."
He added the companies would be responsible for taking care of environmental and social issues. Exploiting the iron reserves would attract billions of dollars in investment, ensuring increased government revenue and work opportunities, he hoped.
The companies will focus to develop train ways, electricity, infrastructural, environment and development of areas.
The bidding process and evaluation of proposals were conducted according to the rule of mines and international procedures. The process was conducted by Gustavson Associates (GA) and International Advisory Panel (IAP), funded by the World Bank, he said.