(Bloomberg) -- Jindal Steel & Power Ltd. has had an environmental application to develop an iron-ore mine in South Africa at a cost of as much as $2 billion rejected. 

The application was refused because of “extensive gaps in the environmental impact assessment in the context of constitutional rights,” All Rise, an environmental legal organization, said in a statement on Monday.

If built, the proposed mine in Melmoth in the eastern KwaZulu-Natal province would dwarf recent investments in South Africa’s mining industry and be the country’s second-biggest iron ore mine. It could produce 32 million tons of magnetite iron ore a year that could be processed into seven million tons of iron ore concentrate, South Africa’s Department of Mineral Resources and Energy said in the notice of refusal.

Read More: Graves a Barrier for Jindal’s $2 Billion South African Iron Mine

The company will appeal the decision within three weeks  and would expect a ruling within 100 days of that, Parshant Kumar Goyal, the general manager for mines and business development at Jindal Africa, said when contacted by Bloomberg. 

Delays in securing the permit won’t affect the timing of the mine development as a six-month period for procedural delays had been built into the plan, he said. Operations are expected to start operations in 2027 and reach peak production in 2031.

The planned development has been opposed by local communities, who say thousands of homes and graves would need to be relocated. Jindal has said all resettlement and grave relocation decisions would be made in consultation with the communities. 

Jindal is controlled by Asia’s richest woman, Savitri Jindal, and her family.

 

(Updates with comment from Jindal in fourth, fifth paragraphs)

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