Idea is to work right from prospecting for minerals to final extraction in Orissa.
State-run Orissa Minerals Development Company (OMDC), a part of the Bird Group of Companies under the ministry of steelm is in discussions with world’s biggest mining company Rio Tinto for a joint venture in the state.
“They have applied together for permission from the state to work in Orissa,” said two sources familiar with the development.
The joint venture will be for the entire value chain, right from prospecting and development to extraction.OMDC will be using Rio Tinto’s expertise for mining its reserves in Orissa.Nicklesh Senapati, chief executive officer (CEO) of Rio Tinto’s India operations, declined to comment on the issue when contacted.
Satish Chandra, chairman of OMDC, was not reachable for comment.
An independent investor said OMDC had talked about being in talks with a big global mining player but has so far not disclosed the name of the company.
In fact, OMDC is looking at a broader association with the player to diversify its mining portfolio and and expand into other assets.
“It is exploring opportunities to go for exploitation of iron ore and other minerals like coal, manganese, diamond, gold etc, for which OMDC is looking
forward for leases/buy properties from foreign countries directly/under special purpose vehicle or a joint ventures,” the company said in its latest annual report.
The company has access to almost 206 million tonnes of iron ore reserves and 44 million tonnes of manganese ore reserves spread across six mines aggregating 4,365.262 hectares in Barbil of Orissa’s Keonjhar district. However, most of its mines are scarcely operational because of expiry of lease licenses, and the company has applied for their renewal.
Recently, Chandra, the company chairman, told DNA that one of its biggest mines — the Thakurani iron and manganese mines, with an area of 1,546.55 hectares and another iron and manganese mine — Kolha Roida, with an area of 254.952 hectares — are expected to start production very soon.
“We are also looking at diversification into other mining activities overseas, spread across assets such as gold, diamond and coal, besides looking at assets in other mineral assets in the country, but that will only happen after we consolidate our position in iron ore,” Chandra had told DNA earlier this month.
At its annual general meeting held at September end, Chandra had said that OMDC plans to increase its iron ore production to 10 million tonnes per annum (mtpa) and manganese ore production to 1 mtpa by 2014-15. It is also investing Rs1,000 crore to set up a 2 mtpa pelletisation plant and a 2 mtpa iron ore beneficiation plant at Thakurani.
Rio Tinto, being the world’s biggest iron ore mining company, is gradually warming up in India. Besides plans to work with OMDC, the company also plans to invest up to Rs400 crore in Madhya Pradesh for mining diamonds there.
OMDC, which was virtually a non-traded stock on the Calcutta Stock Exchange for the last few years, suddenly started generating a lot of interest after it got listed on the Bombay Stock Exchange on August 4, 2010. On Friday, it closed at Rs64,198 when the markets closed for the weekend on Friday.
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