Essar Group to build new 500,000 tonne Zimbabwe steel plant.

A unit of India's Essar Group said it would build a 500,000 tonne steel plant in Zimbabwe for $650 million in two years, revising a deal that had stalled mostly over mineral rights for nearly four years. Essar Africa Holdings in 2010 agreed to buy 54 per cent in Zimbabwe Iron and Steel Company (ZISCO), with the government keeping 36 percent and 10 percent owned by minority investors.

The initial plan was to upgrade the existing steel plant in central Zimbabwe and produce 1.2 million tonnes of steel at a cost of $750 million. The deal immediately ran into problems when the government refused to give Essar mineral rights after it formed and owned 80 per cent of shares in iron ore mining firm NewZim Minerals.

ET