NMDC resumes operations at India’s only mechanised diamond mines in Panna

Operations have resumed at India’s first and only mechanised diamond mining project at Majhgawan, some 15 km from Panna town in Madhya Pradesh.

NMDC, the country’s largest iron-ore miner and a CPSE under the Ministry of Steel, obtained all the requisite approvals, and operations resumed on March 11 this year, sources told businessline. There was no production in the mines from FY22, as per annual report of the company. Losses from the diamond mining project for the first nine months stand at close to ₹50 crore.

“The diamond mining project, Panna, has got all the requisite approvals and resumed operations from March 11,” a senior Steel Ministry official said. The Panna Diamond Mining Project commenced production first in 1971-72. The project includes an ore processing plant with a heavy media separation unit, X-ray sorter for separation and disposal system for tailings generated.

• Also read: Diamond mining set to resume at Panna mines in mid-Nov

Plan of operations

Officials said that for at least one year, the focus will be on overburden removal, and “producing small amount of diamonds from its stockpiles”. After that, work will take place on increasing production. “The project will gradually reach a production of 40,000 carats per annum over the next 2-3 years, once the mine pit is sufficiently expanded, and after overburden removal,” an official said.

In many mineral industries, like coal, in open-cast mines, extraction happens only after removing layers of soil, stone, etc. This soil and stone, etc., are known as overburden. The process of doing away with this overburden is known as overburden removal.

Amitava Mukherjee, Chairman and Managing Director (Additional Charge) and Director (Finance), during a recent analyst conference call, said: “But now for one year, we have to do waste mining. One year we do not expect any diamond to be found. Because the one year waste mining in Panna is generally not a very profitable venture for us. But it is our oldest mine, the only mine.... so it is like the diamond on the crown.”

“Once we start producing it will come on drastically, but it will not be a money spiller for us,” he had said.

Production and sales

In FY21, the mines had achieved a production of 13,681 carats. While there was no production in FY22, diamond sales (from stockpiles) stood at 25,219 carats in FY22 and were valued at ₹62.93 crore. There was no production in FY23 and for over 11 months of FY24. The annual report (FY23) mentions that it has got a prospecting license in the Baloda–Belmundi diamond block in Chattisgarh.

Its previous annual reports mentioned that remote sensing studies have been completed in Chhattarpur Panna Block 1, Chhattarpur Panna Block 2 and Damoh Block, Panna (5 prospective blocks) and additional 12 diamond blocks. Around 3,882 meters of drilling completed in 5 blocks and balance drilling in revenue areas is under progress.

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