KOLKATA (miningweekly.com) – Indian iron-ore miner KIOCL Limited, formerly Kudremukh Iron Ore Company, would invest $250-million to get back into the business of iron-ore mining and pelletisation.

KIOCL had entered into a three-way agreement with Andhra Pradesh Mineral Development Corporation (MPMDC), an arm of the provincial government of Andhra Pradesh, and government-owned steel producer Rashtriya Ispat Nigam Limited (RINL).

Under an agreement signed between the three entities, KIOCL and MPMDC would jointly explore and develop iron-ore reserves in the Anantapur district, in southern India, while KIOCL would construct beneficiation and pelletisation plants near the mines.

Production from the beneficiation and pelletisation plant would be supplied to RINL on commercial terms to be agreed between RINL and KIOCL, a company official said.

KIOCL was planning to set up a 1.2-million-tonne-a-year pelletisation plant, but the final capacity would be determined by the results of the exploration of the iron-ore reserves and the quantum of ore that could be economically mined from it, the official said.

The mining and pelletisation project followed attempts over several years to secure raw material reserves, and would enable KIOCL to get back to its core business of mining. In 2006, India’s Supreme Court forced KIOCL to stop all mining activities in its hinterland of Kudremukh for the violation of environment laws.

The company was founded in 1976 as an exclusive export-oriented iron-ore pellet production unit, mining 4.5-million tonnes a year of ore and producing 3.6-million tonnes of pellets for exclusive shipment to Iran.

Meanwhile, KIOCL and Steel Authority of India Limited (SAIL), both majority-owned by the Indian government, were considering a joint venture entailing an investment of $83-million for construction of a 300 000 t/y coke oven plant along with a captive power plant of 25 MW. 

The plant would be based on imported coking coal and the converted coke would be supplied to steel plants under SAIL.