Bucyrus India Coal Plant Deal Gets Export-Import Bank Financing Approval.

Bucyrus International Inc.’s sale of coal-mining equipment for a power plant in India won U.S. Export-Import Bank financial approval, advancing a project that was rejected in June amid environmental concerns.

The government-backed lender agreed to $900 million in loan guarantees for Reliance Power Ltd. to buy from U.S. companies in building a coal-fired power plant, the bank said yesterday in an e-mail statement. Congress now has 35 days to review the deal before a final vote by the bank.

Bucyrus had lobbied U.S. lawmakers to revive the deal that was initially turned down after groups such as the Sierra Club said funding would undercut the Obama administration’s pledge to limit export financing on projects that might harm the environment. Reliance won preliminary environmental approval in July after giving the bank a pledge to cap the plant’s carbon emissions.

“The bank’s board bowed to political pressure and in so doing wastes public financing to worsen their fossil-fuel binge,” Doug Norlen, policy director for the San Francisco- based environmental group Pacific Environment, said yesterday in a statement.

The Export-Import Bank provides financing to expand U.S. trade. Bucyrus, based in South Milwaukee, Wisconsin, would lose an order for as much as $560 million of electric drag lines and rope shovels to mine coal without the bank’s guarantee, Chief Executive Officer Tim Sullivan said in an interview June 28.

Bucyrus Equipment

About $400 million of the financing will be used to buy Bucyrus mining equipment, which will help support 1,000 jobs, the bank said in the e-mail. The Ex-Im bank board’s decision was unanimous, according to the statement.

Reliance Power of Mumbai was awarded the project to build a power plant in Sasan, central India, in July 2007, using coal that’s mined nearby. The company expects to have 1,320 megawatts of capacity at the plant by March 2012, Chief Executive Officer Jayarama Chalasani said in December.

Environmental groups said the annual estimated amount of emissions from the Sasan plant was more than double the level from all projects funded by the U.S.-government-backed lender last year.

Source : bloomberg.com