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Indian consortium to bid for just a single copper mine in Afghanistan

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Shaida, located in Herat province, scored over the other areas mainly in terms of its location advantage

A consortium of Indian companies, which has joined the global race for acquiring copper deposits in Afghanistan, has decided to bid for only one area against the four that are on offer.

“During the due diligence, we found that it would be prudent to choose only one mining area, Shaida”, chief executive of one of the consortium members told The Hindu. Gold and copper deposits spread over four areas are put on the block by the Afghanistan government, and the bids for two were open last week.

Shaida, located in Herat province in West Afghanistan, scored over the other areas mainly in terms of its location advantage. This area is close to Chabahar Port of Iran, and is only 30 km off a highway.

Four other bidders are believed to be in the race for taking over these mines. The members of Indian consortium include SAIL, HCL, Nalco, Jindal Steel and Monnet Ispat. SAIL leads the consortium with a 26 per cent stake followed by Hindustan Copper. However, enquiries revealed that this holding pattern may have to be re-looked at in case the consortium wins the bid. The Ministry of Mines of Afghanistan had floated the bids for exploration and exploitation of the licence areas through four tenders seeking private participation to exploit the strife-torn country’s rich mineral reserves.

These were Badakhshan (gold), Zarkashan (copper/gold), Balkhab and Shaida (both copper). The Afghanistan Mines Ministry said on its site that the tender process for each project was expected to culminate in the granting of an exploration licence, and, subject to conditions, would lead to the granting of requisite exploration licence. Canaccord Genuity, SRK Consulting and Mayer Brown are acting as transaction advisers to the Afghan Ministry in relation to the tenders for the projects. Mineralisation was identified at the Shaida mine during exploration by the erstwhile Soviets in 1971-72.

Security

The Afghanistan Government has sought to assure prospective investors about the security of their investments saying that these four areas were offered in view of their drill-ready position and ‘relative security’ of the area. It also said that a mines protection unit hads been raised to specially address the issue of safety in mines. A1,500-strong personnel was active in the Aynak Copper Mine site.

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Printable version | Dec 9, 2019 12:41:11 PM | https://www.thehindu.com/business/indian-consortium-to-bid-for-just-a-single-copper-mine-in-afghanistan/article3799938.ece

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