KOLKATA (miningweekly.com) - Indian iron-ore miner NMDC Limited will ramp up its production capacity to 63-million tonnes a year by 2021/22, from 32-million tonnes achieved in 2018/19.
The company is also planning to reduce logistics and transportation costs by 55% by constructing a slurry pipeline.
Incremental production volume of around 52-million tonnes a year will come from the expansion of its existing iron-ore mines in the central Indian province of Chhattisgarh, while an estimated 11-million tonnes a year will be sourced from new mines that NMDC is planning to open up over the next few years, company sources say.
While the miner was able to produce 32-million tonnes of iron-ore during 2018/19, it was down from 35-million tonnes achieved during the previous fiscal and the lowest volume produced by the company over the last decade.
The shortfall in production during the year is partly owing to NMDC’s spat with the southern Indian state government of Karnataka, over the lease extension for its Donimalai mines.
NMDC was forced to close down operations of its seven-million-tonne-a-year Donimalai mines last year, after the Karnataka government sought 80% premium on revenues for extending the mining lease, which the miner disputed and challenged in court.
In a bid to prune its transportation and logistics costs, NMDC is spending an estimated $415-million initial tranche for the laying of a slurry pipeline to transport pellet feedstock from its Bailadila mines in Chhattisgarh to its pellet plant at Jagdalpur.
In addition the company is also setting up a two-million-ton iron-ore processing plant at Bacheli, in Chhattisgarh and a two-million-tonne pellet plant at Nagarmar where NMDC is also nearing completion of the setting up of a three-million-tonne greenfield steel mill linked to its iron-ore mines.