KOLKATA (miningweekly.com) - India’s Steel Ministry has mooted a proposal for a joint venture (JV) between iron-ore miner NMDC Limited and Orissa Mining Corporation (OMC) to offer stronger iron-ore supply linkages to domestic steel producers.
Noting that the steel industry faced problems of raw material linkages, the Steel Ministry believed that a JV between NMDC and OMC, a mining company controlled by provincial government of Odisha, would be able to offer higher volumes of raw materials to the steel sector.
“There are a lot of future prospects if OMC and NMDC can work together,” secretary for the Steel Ministry, G Mohan Kumar said.
“Solving issues relating to mining would boost investments in the steel sector and would open up the second phase of investments in steel and mining in the eastern province and collaboration between the two government-owned mining companies would be able to sort out the issues in the mining sector,” he added.
An official in the provincial government of Odisha said that while OMC controlled a vast range of mineral assets, such iron-ore, manganese and chrome, collaboration with NMDC would enable faster ramping-up of these resources, leveraging the financial muscle of NMDC.
As for NMDC, which had iron-ore mining operations predominantly in the central Indian province of Chhattisgarh and Karnataka in the south, a partnership with OMC would enable the company to gain a foothold in mineral resources in eastern India and move a step toward its target of 50-million tonnes of iron-ore production by 2015.
During the current fiscal year, NMDC forecast a modest growth in iron-ore production of 28-million tonnes, up from about 27-million tonnes achieved in the year ending March 2013.
OMC had, for decades, been scouting for a partner to expand its mining operations across its vast mineral resource assets in Odisha. This included a JV agreement signed between OMC and Rio Tinto way back in 1995, which had not taken off to date.
OMC has mining leases across 35 locations in Odisha. The company controlled reserves of 400-million tonnes of iron-ore, 19-million ton of manganese, 28-million tonnes of chrome ore, 220-million tonnes of bauxite and 19-million tonnes of limestone.