K`taka asked to allot mine to Kudremukh

The prospecting of the virgin mines has indicated that the region has 10 million tonnes of haematite ore deposits spread across 110 hectares.

Mining lease to the untapped iron ore reserves at Chikkanayakanahalli, about 80 km from Bangalore, will enable the mini rathna public sector enterprise to partially meet the shortage of raw material for its pellet plant at Mangalore and diversify into manufacturing value-added steel products.

"The Union ministry of mines has written to the Karnataka government to grant a mining lease in our favour at Chikkanayakanahalli in Tumkur district. We have already approached the state chief secretary for the mining licence at the earliest," KIOCL chairman and managing director K Ranganath told Business Standard in an exclusive interview.

"We have found the ore will meet our requirements. The ministry of environment and forests has also given its consent. Once we secure the mines, we will prepare a project report and start mining," Ranganath said.

The company has also applied for mining licences at Ramanadurga in Bellary district of Karnataka, Orissa, Jharkhand, Madhya Pradesh and Chhattisgarh.

The company has recently signed a memorandum of understanding (MoU) with Orissa Mining Development Corporation (OMDC) to conduct joint mining at Barbil in the eastern state.

"We have finance, equipment and manpower with us to carry out mining anywhere in the country," he said. The company plans to extract about 1.2 million tonnes of iron ore with OMDC to increase the total extraction of iron ore to 4.2 million tonnes at Barbil, Ranganath noted.

KIOCL, which reported a net profit of Rs 108 crore on a sales turnover of Rs 1,500 crore in 2007-08, is aiming at doubling the bottomline at the end of this fiscal (2008-09) by producing 2.5 million tonnes of pellets and 160,000 tonnes of pig iron.

"The days of depression are over for us. NMDC has stepped up supply of iron ore to us. We are hopeful of getting new mines. We wish to perform better than in the last fiscal," Ranganath said.

The beleaguered company had to shut down its captive mines at Kudremukh in Chickmagalur district from January 1, 2006 in compliance with the Supreme Court order of October 2002.

The apex court order was in response to a public interest litigation filed by an NGO, seeking closure of the mines in the midst of the Western Ghats in southern Karnataka.