| Date: |
01-07-2010 |
| Subject: |
U.S. Export-Import Bank Reconsiders Rejecting India Coal Financing Deal |
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The U.S. Export-Import Bank will reconsider its rejection of a loan guarantee for Bucyrus International Inc. so it can sell coal-mining equipment for a power project being developed by India’s Reliance Power Ltd.
The bank acted after Democratic lawmakers in Wisconsin, where Bucyrus is based, appealed the rejection last week of $560 million in financing on environmental grounds. Reliance told the bank it may buy U.S. equipment for a renewable energy project, bank Chairman Fred Hochberg said in a letter.
The bank “will take into account Reliance’s expressed commitment to invest in the renewable energy sector” in its review, Hochberg wrote to Reliance chairman Anil Ambani today.
Bucyrus would lose an order worth as much as $560 million for electric drag lines and rope shovels to mine coal without getting the Export-Import bank’s guarantee, Bucyrus Chief Executive Officer Timothy Sullivan said in an interview June 28. The financing request was turned down last week as part of the lender’s review of the project because of its potential carbon emissions.
Reliance Power of Mumbai was awarded the project to build a power plant in Sasan, India, in July 2007, using coal mined nearby with Bucyrus’s equipment.
According to Hochberg’s letter, which was provided by the office of Wisconsin Senator Herb Kohl, both sides have the “desire” for Reliance to use equipment from U.S. companies at its 250 megawatt renewable energy power plant.
Source : Bloomberg
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