Diamond giant Rio Tinto has decided to close its Bunder diamond project in Chhatarpur district, the company said.
Rio Tinto Exploration India Private Limited said in a statement that as part of its ongoing efforts to drive shareholder value by conserving cash and cutting costs further, it has decided not to proceed with the development of its Bunder project.
“Accordingly, we will be seeking to close all project infrastructure by the end of 2016. Rio Tinto firmly believes that the Bunder deposit is a high-quality discovery. Rio Tinto will now work with both the Centre and the state government and is currently looking at options for a third-party investor to carry forward the development of the project,” the statement said.
Rio Tinto emphasised that it remains committed to its diamond business and the Indian diamond industry through its two world-class underground mines in Australia and Canada.
“Rio Tinto remains committed to India as an important market for our metals and minerals and as a key global hub for the firm’s shared services delivery. As part of the transition, Rio Tinto will offer a fair and equitable voluntary severance scheme to contractors employed at the project site,” the statement added.
Rio Tinto was granted prospecting license in 2006, after the Bunder pipes were discovered in 2004. Last month, HT had reported that the government shelved granting permission to mining corporation Rio Tinto to open a diamond mine in Madhya Pradesh, saying the plan endangers a rich forest area and a tiger corridor between the Panna Tiger Reserve and Nauradehi Wildlife Sanctuary.
The report said that according to Rio Tinto, there are diamonds worth Rs 20,520 crore in Bunder. But environmentalists are concerned that the Rs 2,200 crore Bunder diamond mining project involves clearing 971 hectares of forest area in Chhatarpur region.