By The Business Journal of Milwaukee

The board of the U.S. Export-Import Bank began to officially reverse its denial of loan guarantees that put a $600 million Bucyrus International Inc. contract in jeopardy, voting 3-0 Wednesday to approve the environmental aspects of the deal with a power company in India.

Two more votes are required before the loan guarantees become official, according to Wisconsin Senators Herb Kohl and Russ Feingold. The loan guarantees supported the financing of mining equipment for a coal-fired power plant in India, which would have effectively canceled the large equipment order for South Milwaukee-based Bucyrus (NASDAQ: BUCY), a manufacturer of mining equipment, and forced the possible loss of 1,000 jobs, including 300 in Wisconsin.

The original denial of the loan guarantees for Reliance Power Ltd. of India, based largely on environmental concerns, created an uproar among lawmakers in Wisconsin and the Milwaukee area, who called for the bank to reconsider.

After meetings with lawmakers, Export-Import Bank Chairman Fred Hochberg notified Kohl and Feingold June 30 that the Ex-Im Bank would reconsider its decision if Reliance could present a new proposal including an increase in the amount of renewable energy produced in India, with a preference for American-made equipment.

â¿¿We did not want to see jobs in our state jeopardized and did all we could to be effective advocates for Bucyrus Internationalâ¿¿s work force," Kohl said. "Chairman Hochberg was open-minded and reasonable throughout this process, and (Bucyrus CEO) Tim Sullivan worked tirelessly for his employees."

The vote represents the first in a series of three votes the Ex-Im Bank will conduct before the Reliance/Bucyrus deal is finalized. Following this approval, there will be a vote â¿¿ possibly in late August â¿¿ on financial aspects of the deal, then a 35-day period where the deal is sent to Congress for review, and then a final vote by the Ex-Im Bank board in the fall, according to Kohl and Feingold.

In a statement, Sullivan expressed his confidence that the approval process will proceed smoothly.

"This is the first step in the process to provide financing, which will create nearly 1,000 jobs across 13 states in the U.S.," Sullivan said. "We are confident that the remaining steps of this process, including financial review, will be completed expeditiously in order to allow Reliance Power to proceed with its project plan."

Copyright 2010 American City Business Journals

Copyright 2010