NMDC, UK146;s Spice to enter 50:50 JV

With no fresh allocation of iron ore mines likely in India, state-owned NMDC is eyeing overseas markets rich in natural resources.

With no fresh allocation of iron ore mines likely in India, state-owned NMDC is eyeing overseas markets rich in natural resources. It has tied up with UK-based Spice Energy for a joint venture JV and is close to clinching a deal for acquiring mines in mineral-rich Eritrea, Congo and Armenia.

8220;The proposed 50:50 JV company, to be christened NMDC Spice International, will carry out exploration in these countries besides acquiring couple of iron ore mines in Armenia. Our experts have decided to proceed with an estimated investment of about Rs 2,000 crore,8221; NMDC chairman and managing director Rana Som told The Indian Express.

The two iron ore deposits identified have reserves of 300 million tonnes and 75 million tonnes. The final discussion over the acquisition will be held on July 12 wherein representatives of Spice Energy are expected to clarify NMDC queries pertaining to the acquisitions in the three countries where Spice owns mines. Once these are sorted out, the proposal would be put to the NMDC Board later in the month for approval.

Investments in these mines are likely to be more than in most mines as the quality of the mineral here needed more value addition and pelletisation. However 75-million- tonne privately held deposits had been fully explored

The JV company will set up a beneficiation and pelletisation plant in Armenia as the ore quality there is as low as 35 per cent iron which could be at best used for pelletisation. The JV company would utilise the Poti port in Georgia on the Black Sea for bringing the pellets to India. The port is also connected to the Russian railway network, Som said.

Meanwhile, NMDC is yet to begin transportation of iron ore from Bailadila to Andhra Pradesh as the railway tracks uprooted by suspected left-wing guerillas is yet to be okayed. 8220;Intense efforts are on to make the railway network transportable by tomorrow. We hope we are able to do so,8221; Som said. On May 31, Maoists blasted three high-tension transmission towers near Narayanpur in Bastar Division paralysing production of iron ore at Bailadila.

Major miner

8226;The proposed JV company will carry out exploration in the mineral-rich countries of Eritrea and Congo

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8226;The company will also acquire two mines in Armenia with iron ore deposits of 300 mt and 75 mt

8226;NMDC to invest Rs 2,000 crore in JV company