Global Steel Holdings, the holding company which controls the steel and associated businesses of the Ispat Group, has acquired two coal blocks in Mozambique.
According to sources, the investment in the blocks would be in the region of Rs 460 crore (Rs 4.6 billion).
The blocks, the licence for which covers around 30,000 hectares, has proven resources of around 70 million tonnes of coking coal with low to medium ash content.
The sources said that exploration work has already commenced and the actual reserves could be higher considering the potential of the blocks.
The blocks are in the Tete region, near the coal areas licenced to ArcelorMittal, Tata Steel and Vale.
The transport of coal from the mines to the nearest sea port of Biera, which is about 600 km away, is proposed to be done through the railway network under construction which is likely to be operational within a year. Production of coal is expected to start in three-four years.
Currently, Global Steel operates and manages about 13.8 million tonnes of steelmaking capacity in Bulgaria, Nigeria, Philippines, Libya and India.
It also has associated businesses in coke making, ferro alloys, chromite, iron ore mining and energy in Bosnia, Nigeria and India.