NMDC eyes new iron ore deposits through auction, Govt dispensation route

V. Rishi Kumar Hyderabad | Updated on August 30, 2019

To focus on brownfield expansion, new mines

NMDC Ltd plans to pursue allocation of new iron ore deposits both by participation in auctions and the Government dispensation route, even as it seeks to expand its brownfield mines to increase its production target to 67 million tonnes per annum (MTPA).

During its 61st Annual General Meeting, NMDC unveiled plans to increase its production capacity to 67 mtpa.

The development of a greenfield mine has been planned through a joint venture with Chhattisgarh State Mineral Development Corporation, for which it has appointed a mining developer. This will add 10 MTPA of capacity in the next four-five years.

Addressing the AGM, N Baijendra Kumar, Chairman and Managing Director of NMDC, said it is proposed to raise the company’s current mining capacity of 43 MTPA to 67 MTPA with the aim of meeting the domestic iron and steel sector’s requirement.

The company registered a good performance in the first quarter of this fiscal in spite of problems with the Donimalai lease. It is hopeful of resolving the issue. The company closed the last fiscal with a profit of Rs 4,642 crore and a networth of Rs 25,952 crore as of March 31, 2019.

Progress on construction of the 3 mtpa steel plant at Nagarnar, Chhattisgarh, during 2018-19 has been noticeable and various packages are under construction and nearing completion. Cold trial of individual equipment under various packages is in progress. The steel plant is scheduled to be commissioned in three phases and is expected to be operational by the third quarter of FY 2020-2021.

To increase the evacuation capacity from the Bailadilla sector, NMDC has taken up doubling of the Kirandul-Jagdalpur railway line, which will reduce the total turnaround time for rakes. The slurry pipeline from Bailadila to Jagdalpur and further to Visakhapatnam, with a capacity of 15 MTPA, will add to the ease of evacuation.

In order to meet the growing demand for sponge iron ore industries in the Bailadila sector, sale of new product-sized lump ore of 10-20 mm started in March 2019. This is a direct feed material for sponge iron plants.

NMDC started production of pellets from its 1.2 MTPA pellet plant in Donimalai sector, utilising iron ore slimes and sold about 1.15 lakh tonnes of pellets in 2018-19.

The company is developing a stockpile to accommodate about 5 lakh tonnes of iron ore cargo at Kumarmaraga in Chhattisgarh, which is likely to commence this fiscal and facilitate enhancing its evacuation capacity and taking care of disruptions caused due to heavy rains and night movement restrictions.

NMDC plans to take up its overseas business in a strategic way, which includes a mining lease in Tanzania, Legacy Iron Ore Ltd in Australia and ICVL, a joint venture company in Mozambique.

As the single largest producer of iron ore with an output of 32.4 mt in 2018-19 and a market share of 24 per cent in merchant mining and 15 per cent in the country’s production, NMDC expects to sustain the growth momentum.

Published on August 30, 2019

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