Leighton Holdings CEO Arrested; Could Jeopardize the Future of a $5B Coal Mine in India
Australia’s largest construction company, Leighton Holdings (ASX:LEI), is in hot water this week after their CEO was arrested on charges of cheating and criminal breach of trust. The arrest could cost the company a multimillion contract to develop and operate a $5.5 billion coal mine in India.
According to police sources, Raman Srikanth, chief executive of Leighton Holdings’ Theiss mining subsidiary in India, was arrested in relation to ongoing civil proceedings filed by Hyderabad-based Roshni Developers Private Limited in Singapore. Thiess Minecs India Private Limited is presently working on a coal mining project at Pakri Barwadih near Hazaribagh town in Jharkhand. The $5.5 billion coal mine is being developed for state-owned NTPC Ltd.
"Our teams went to Kolkata and arrested him. He has been remanded to judicial custody. It was a court directed case based on a complaint by Roshni Developers. We are investigating the case further," Deputy Commissioner of Police (Madhapur Zone) Kanthi Rana Tata said.
According to sources, Roshni Developers filed a private petition in a local court alleging that Thiess Minecs has resorted to criminal breach of trust and cheating by violating the agreement both the partied had entered in 2010. Representatives of Roshni Developers had alleged Thiess Minecs did not abide to their contractual obligations with regard to tapping a coal mine near Hazaribagh.
"By believing that they would get the sub-contract from Thiess, the owners of Roshni Developers had spent Rs 185 crore on the mining project. However, Roshni Developers alleged that after getting the contract from NTPC to develop the mine, Thiess Minecs cheated them by not giving sub-contract," the inspector said.
Since the arrest, the future of the Pakri Barwadih coal mine is in jeopardy as NTPC Ltd. issued a notice to terminate the contract, which was awarded to Thiess Minec in 2010.
Shares of Leighton Holdings closed at AUD 19.8, down 1.25 per cent from the previous close in the Australian Securities Exchange.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.