Jindal Steel’s mining JV with Uranium Corp put on hold

Jindal Steel’s mining JV with Uranium Corp put on hold

New Delhi: A proposed joint venture between state-owned Uranium Corp. of India Ltd (UCIL) and Jindal Steel and Power Ltd (JSPL) to mine the nuclear fuel has run into trouble due to differences between the two companies.

JSPL and UCIL had signed a memorandum of understanding (MoU) to start a 74:26 joint venture, in which the former was supposed to conduct geological investigations and the latter was to provide technical support.

UCIL chairman and managing director Ramendra Gupta told Mint that the proposal has been “kept in abeyance".

A critical step towards setting up the venture was the establishment of a joint committee to examine the technical and commercial viability of the proposed company, a JSPL spokesperson said in an emailed response.

“The committee (was) never set up and the viability study never done. The MoU, therefore, slid into a cold storage," the spokesperson said.

State-run Nuclear Power Corp. of India Ltd estimates India’s uranium reserves to be some 78,000 tonnes, about 0.8% of the global total, which can support around 10,000MW of generation. But delays in uranium mining projects have resulted in a demand-supply mismatch.

Atomic energy is the exclusive preserve of the government and uranium, the preferred nuclear fuel, can be mined only by UCIL.

It is, however, expected that after India signed a civil nuclear pact with the US last year, the sector will be opened up to private firms.

Domestic power companies believe they would be able to source uranium competitively if they partner with the state miner.

JSPL has also shown interest in building nuclear power projects.

Uncertainty over raw material supply has dogged India’s power and steel companies for a long time and it could also happen in the nuclear power sector, said Dipesh Dipu, principal consultant in mining at audit and consulting company PricewaterhouseCoopers.