Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

The Ministry of Environment and Forests has granted stage one in-principle approval for the diversion of  401.57 hectors of forest land at Devadari Hill Range in Ballari district to Kudremukh Iron Ore Company (KIOCL) for iron and manganese ore mining for 50 years.


Although the company received stage one approval on June 24, it still has to obtain the second and final approval before commencing operations. Mining activities in the new captive mine could commence from the next financial year.


It has been over 15 years since KIOCL was allotted a captive mine. A Supreme Court verdict in December 2005 had forced the company to completely halt its mining activities at its previous facility located in Kudremukh.


The government-owned company relied on private mines located within the state and outside for raw materials like iron ore and manganese for pellet manufacturing for the last 15 years. The captive mine will ensure raw material security for better product quality, believes the company.


Initially, the company aims to mine 300,000mt of ore and subsequently raise it to 2mn mt in five years. The total expenditure of the new mining activity will be Rs15bn of which, Rs1.50bn have been allocated for pre-mining activities.


In the second stage, a pellet plant is planned in Devadari. In the meantime, extracted minerals would be sent to the KIOCL pellet plant in Mangaluru. The company plans to extend its markets to Brazil, Middle East, and North African (MENA) countries.

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