Sesa Sterlite Ltd. (SSLT) plans to cut an iron ore project in Liberia by 80 percent after approval delays halted infrastructure plans and a mining ban in India sapped cash flows, people familiar with the matter said.
Initial capacity at the Western Cluster mines may be slashed to 400,000 metric tons a year from 2 million tons, according to three people, who asked not to be identified pending an announcement. Sesa, India’s most valuable metals producer, based in the western state of Goa, had expected to ship its first consignment from Liberia last month and spend $2.4 billion to reach 30 million tons by 2017.
Billionaire Chairman Emeritus Anil Agarwal’s strategy to tap western Africa, dubbed “the new Pilbara,” referring to the Australian region where BHP Billiton Ltd. and Rio Tinto Group have mines, have been foiled by falling ore prices and a cash-crunch arising from Sesa’s mines lying idle for more than 18 months. In October 2012, India’s top court banned mining in Goa, where Sesa has almost all its mines, effectively shutting down India’s biggest exporter of the steelmaking material.
Written by Rajesh Kumar Singh and Abhishek Shanker/Read more at Bloomberg BusinessWeek
