India-based Jindal Steel & Power's Bolivian iron ore project--the El Mutun deposit, estimated to hold 20 billion metric tons of ore--is at risk after the Bolivian government encashed another $18 million bank guarantee from the firm for not meeting contractual terms, according to news reports Monday.
Jindal Steel Bolivia (JSB) had previously been fined a similar amount by the South American nation in 2010, after being accused of not meeting its commitments. In 2007, Jindal Steel won the 40-year rights to the iron ore deposit, and per its contract with Bolivia, JSB was to invest $600 million over two years. However, disputes over energy availability have resulted in the company falling short on its commitment.