Chhattisgarh extends leases of 4 NMDC mines to maintain iron ore supply

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The Chhattisgarh government has extended leases of state-owned NMDC's four mines in the state, to avoid interruptions in iron ore supply to the steel sector.

As the result of the move, operations of the country's largest iron ore miner NMDC will not be affected in the state and the company will be able to supply raw material to steel makers.

Earlier, NMDC had to suspend iron ore mining at its Donimalai mine in Karnataka following a decision of the state government to impose 80 per cent premium on the iron ore sales from the mine.

NMDC Chairman and Managing Director N Baijendra Kumar said iron ore mines have been extended for another 20 years

"We are grateful to the Government of Chhattisgarh and especially Chief Minister Bhupesh Baghel and top officials for their support to NMDC in granting extension of lease for the four mines for another 20 years," he said.

The lease of the mines were due for extension in March 2020, an NMDC official said.

Last month, the company said the Chhattisgarh government has assured the public sector undertaking of renewing mining leases in the Dantewada district for another 20 years.

The state-owned firm, which has been in the business of mining iron ore for over six decades, operates three iron ore complexes in the country.

While one is located at Donimalai in Karnataka, two are in the Dantewada district of Chhattisgarh contributing 70 per cent to the company's total output.

Of the NMDC's 33 million tonnes per annum (MTPA) production, Chhattisgarh's two complexes in Bacheli and Kirandul under the Bailadila project contribute about 24 million tonnes per annum (MTPA) in 2018-19.

At the 7-MTPA Donimalai mine, mining operations have been suspended for want of renewal of lease.