Spooked by North Korea stake,NMDC drops its bid for coal mine in Russia

The other two owners are CJSC Baltiyskaya Companiya,also of Russia,which has a 29.9 per cent stake,and the North Korean firm Vneshugol,which holds a 20 per cent stake.

The project is in Russia’s eastern Sakha region,and has estimated reserves of 100 million tonnes,of which 2.5 million tonnes are mineable annually. However,it currently produces barely 0.1 million tonnes to comply with licence obligations,and is in need of capital infusion. NMDC had intended to spend $165 million spread over three years.

The company’s October 10 board meeting,however,took note of the ownership of the North Korean firm,and decided to abort the proposal.

“Apprehensive of an adverse regulatory fallout in case we acquired Vinci as North Korea is facing US sanctions,we have decided to drop the acquisition proposal,” NMDC CMD Rana Som told The Indian Express.

The board also reasoned that Vinci was,after all,not so ideally located in terms of evacuation infrastructure,with the nearest port,Vanino,on the Strait of Tartary in the Sea of Japan,being as much as 230 km away.