KOLKATA (miningweekly.com) - With limited opportunities to expand mining operations within the country, India’s largest iron-ore miner NMDC Limited was increasing its focus overseas, including the new exploration efforts by its Australian subsidiary Legacy Iron and Russian potash firm Acron.
According to a company official, the appointment of Rakesh Gupta as CEO of Legacy last month was the next step towards leveraging the considerable assets of NMDC in Australia.
The new CEO would oversee the completion of feasibility studies of new projects over the current year and initiate exploration projects over the next two years thereafter, he said.
The projects to be taken up in Legacy Iron Ore were a logical progression of NMDC’s strategic corporate plan of increasing its equity stake in the former by 30%, taking up the Indian’s miner’s total stake in the Australian asset to 78.56%, the official added.
NMDC, as the largest miner and a government owned and managed company, has been under considerable pressure to ramp up production to ease raw material supply pressure for domestic steel mills.
In fact, in a recent meeting with the Steel and Mines Ministry, the miner had been set a target of 100-million tonnes a year of iron-ore production by 2019, up from current levels of 30-million tonnes a year. As per the corporate strategic plan, at least 10% of the target was expected to be met from Legacy, the official said.
Incidentally, at the meeting, the target date for achieving higher production was brought forward to 2019 from 2025, in view of the shortage of iron-ore availability in domestic markets.
At the same time, NMDC would shortly be appointing consultants to commence due diligence on the proposed acquisition of 30% equity stake in Russian potash firm Acron.
The due diligence report on the proposed investment of around $2-billion for the 30% stake would be completed within the next three to four months following which a binding offer would be made by NMDC to Acron as per the memorandum of understanding signed between the two.
Once the investment was successfully concluded, India would be able to source about one-million tonnes a year of potash from Acron against the total country’s potash import of around four-million tonnes a year.
The NMDC investment in Acron would be through a consortium of Indian chemical and fertiliser companies that include, Rashtriya Chemicals and Fertilisers Limited, Krishak Bharti Co-operative Fertiliser Limited, National Fertilisers Limited and Fertilisers and Chemicals Travancore Limited.
