NMDC decides its iron ore reserves could be two-thirds higher

India’s largest iron ore producer, NMDC, has identified additional resources of 611 million tonnes (mt) at its existing mines in Chhattisgarh, a potential addition to the present estimate of its reserves, which are 922 mt across Bailadila in Chhattisgarh and Donimalai in Karnataka.

“With continuous exploration we have added resources of 611 mt at the mines in Bailadila that we had as on April 1, 2005,” a senior NMDC official said.

The public sector miner would now have to undertake drilling. “We expect that the resources will translate to (additional) reserves of around 611 million tonnes,” the official said. The process is likely to be completed over the next five years.

With an expanding steel sector, the additional resources would come handy for steelmakers. NMDC, which produces around 22 mt annually, supplies iron ore to companies such as Essar Steel, Ispat Industries, JSW Steel and Rashtriya Ispat Nigam Ltd.

Though India has abundant iron ore reserves, most of it is either not proven or cannot be accessed.

India has an estimated 23.59 billion tonnes of ore scattered in Jharkhand, Orissa, Chhattisgarh, Karnataka and Goa. Of this, only 6.311 bt is proven; the other 17.27 bt are probable and possible reserves. Moreover, 75 per cent of the low grade reserves are in the ecologically and environmentally sensitive Western Ghats.

With the steel ministry setting an annual capacity target of 100 mt by 2012, NMDC’s new resources will mitigate resource requirements to an extent.

NMDC is setting up steel plants, as well. In Chhattisgarh, it is setting up a three-million tonne plant in Chhattisgarh and a five-million tonne unit in Karnataka.