El Cerro Mutún (Spanish for "the Mountain Mutún") is the world's largest iron ore deposit.[1] Located in the Germán Busch Province in the Santa Cruz Department of Bolivia, near Puerto Suárez, it extends across the border into Brazil, where it is called the Serrania de Jacadigo. Also known as the "Serrania Mutún", it has an area of about 75 square kilometers. Its estimated reserves are about 40.205 billion (40.205 × 109) tons of iron ore[2] of 50% iron, mainly in hematite and magnetite form, and in lesser quantities in siderite and manganese minerals. This can be compared with an estimate of the total world reserves of iron ore: 800 billion tons of crude ore containing more than 230 billion tons of iron.[3]
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In 2007, India's third largest steel manufacturer, Jindal Steel and Power Limited, signed a contract with the Bolivian government to exploit the El Mutún iron ore deposit. According to the contract, Jindal would invest US$ 1.5 billion initially and an additional US$ 2.5 billion over the next eight years. This is the single largest investment by an Indian firm in Latin America.[4] By September 2011, Jindal had obtained clearance for the project from the EIA and had hired an engineering consultant for FEED work.[5] The project is expected to create 6,000 jobs directly and another 15,000 indirectly.[6]
Jindal Steel will setup an integrated 1.7 MTPA steel plant, a 6 MTPA sponge iron plant, a 10 MTPA iron ore pellet plant and a 450 MW power plant.[5] The project is expected to generate US$200 million in revenues for the Bolivian, equivalent to 5% of its current revenue.[7] According to the Bolivian government, the Jindal complex will generate more than 21,000 jobs.[7] As of 2009, Jindal had only invested US$20 million on the Mutun project due to difficulty in securing natural gas supplies from the Bolivian government for the 450MW power plant and ore smelting process.[8]
An editorial in La Jornada alleged that contrary to contract terms, Jindal was mostly interested in extracting iron ore concentrates and exporting the raw material for further processing at its plants in India.[9]
In early 2000s, Brazilian company EBX devised a project to create a foundry in El Mutún. However, the project was blocked by Bolivian president Evo Morales because of environmental concerns; instead of using natural gas available from a pipeline 20 km away, vegetable carbon was to be used for the foundry, demanding 45 hectares a day of Amazonian wood.[10] Despite this, EBX started working anyway before obtaining its licence, under the name of MXX. The Bolivian Ministry of Defence declared that "various irregularities and constitutional violations" had been observed. On April 19, 2006, the Bolivian army freed three government ministers who had been taken hostage by villagers demanding the immediate opening of all EBX's installations.[11] By 2007, the Bolivian government had expelled EBX from the Mutun region.[7]