Rio Tinto, NMDC to jointly explore mining reserves

Global mining major Rio Tinto and state-run NMDC Ltd are set to enter into an agreement to explore global and domestic iron ore reserves, a top official of the Indian company said.     
"We will be entering into a memorandum of understanding (MoU) with Rio Tinto on August 18 for scouting mining resources in different parts of the world including in India," NMDC Chairman Rana Som said over phone from Hyderabad.     

The MoU envisages a strategic partnership between the two leading mining companies for prospecting iron ore reserves, both internationally and domestically, he added.     

"The two companies may also contemplate entering into a joint venture once they identify mining properties," Som said.     

NMDC has already entered into a joint venture agreement with country's Spice Energy and is about to acquire iron ore mines in Armenia, Eritera and Congo.     

Asked about the price negotiation with Japanese and South Korean steel mills for supply of iron ore, the NMDC Chairman said the matter was pending with the government.     

"We have made our point that high freight charges and ad-valorem export duty on iron ore are hitting our margins. It is now up to the government to decide whether we should seek higher price for our high quality iron ore from Japanese and Korean mills or not," he said.     

NMDC is seeking up to 97 per cent increase in iron ore prices from foreign steel makers, a move that could have similar repercussions on the domestic market, which may result in higher steel prices.