Vedanta bags India’s first gold mine lease in Chhattisgarh
Vedanta Limited won India’s first-ever gold mining lease auctioned by the Chhattisgarh government, officials said on Saturday.business Updated: Feb 27, 2016 14:00 IST
Vedanta Limited, a global diversified natural resource company, won the nation’s first-ever gold mining lease auctioned by the Chhattisgarh government, officials said on Saturday.
The gold mine at Baghmara in Baloda Bazar district, about 140 km north-east of Raipur, is one of the oldest explored deposit of the precious metal in Central India.
India imports about 1,000 tonnes of gold every year and the precious metal is the second-highest component of the imports bill after crude oil.
Last year, the Centre launched a gold monetisation scheme aimed at reducing physical gold demand and luring tonnes of gold from households into the banking system. An estimated 20,000 tonnes of gold are lying with households and temples in India.
Chhattisgarh officials said the auctioning process witnessed aggressive bidding and ended nearly 13 hours later on Friday night with more than 160 bids submitted.
Vedanta quoted the highest bid of 12.55% of the Indian Bureau of Mines price of Rs 74,712 per troy ounce. One troy ounce — a unit denoting the value of the precious metal— is 31.10 gram.
The auction is expected to yield Rs 82 crore to the state exchequer in addition to the royalty of Rs 25 crore.
An estimated reserve found during the initial prospecting for gold in the region, that spreads over 607 hectares, is 2700 kg. According to the mining officials, the reserve reckoning will increase once the deep mining is explored by Vedanta.
Chief minister Raman Singh who is also in charge of the mining portfolio said that besides ensuring greater transparency, the e-auction also speedily accomplished the mining lease allocation.
“Employment potential will now be generated from exploration, mining of gold and the jewellery business”, he added.
Secretary, mineral resources, Subodh Kumar Singh, said every action plan of Chhattisgarh remaining focused on “ease of doing business”. The Baghmara gold mine will contribute towards India’s target to reduce gold import, he added.
The four companies that participated in the auction were Rungta Mines Ltd, Vedanta Limited, Krishna Global Minerals Ltd and Sainik Mining and Allied Services Ltd.
The state government invited bids for granting of mining lease through the auction of one gold block and the four limestone blocks on December 8 last year.
The pre-bid conference for registered bidders for the gold block was conducted on January.
Last week, the first-ever non-coal mining lease was auctioned by Chhattisgarh state with Shree Cement Limited (SCL) bagging the Karhi Chandi limestone block in Baloda Bazar district.