Gold mine for NMDC

India’s largest iron ore miner NMDC Limited has finally got a golden opportunity. The public sector undertaking is all set to extract gold in Tanzania.

According to NMDC's in-charge chairman and managing director NK Nanda, the Navaratna company has secured a gold mine lease in Bulyang’Ombe and Saga Hills area of the African country.

This is the first gold mine project NMDC could bag even though the company had been exploring the possibilities for gold mining in Singhbhum and Ranchi districts of Jharkhand for quite some time.

Nanda told Business Standard that the Tanzania mine was estimated to be having gold deposits of four tonnes and NMDC would start mining within six months. The initial investment in this regard would be to the tune of $50 million (about Rs 250 crore).

After obtaining retention licence, NMDC was pursuing gold exploration in Tanzania for the past four years. " We have done 15,000 metres of drilling in this connection," Nanda said.

With the lease in hand, NMDC is currently in the process of identifying a joint venture (JV) partner for developing the gold mine. If it is not able find a JV partner, then it would undertake mining activity on its own, Nanda said, adding the company was interested in having a partnership only with an enterprise that was already into mining or related activity in Tanzania.

In fact, NMDC is keen to start gold mining as production of precious material is nothing new to the company. It is already into diamond mining and, in 2010-11, recorded a production of 10,865 carats of diamonds. Its diamond sales at 18,421 carats worth Rs 12.88 crore last year was, however, more than its production during the year.

To enhance its diamonds production, the company is now carrying out exploration works in Andhra Pradesh and Madhya Pradesh.