NMDC pact kindles Rio Tinto hope

Calcutta, Nov. 18: National Mineral Development Corporation Ltd (NMDC) may bring global mining giant Rio Tinto to Bengal. The country’s largest iron ore miner is planning to develop a large coal mine, the fifth largest in India with a deposit of 2 billion tonnes, in the state. NMDC chairman and managing director Rana Som said the corporation would induct a foreign partner in the Deocha-Pachami coal block in Birbhum. “We have held talks with Rio Tinto,” Som said after NMDC signed a memorandum of understanding with the West Bengal Mineral Development & Trading Corporation (WBMDTC) to develop the block. The two entities will initially hold 50 per cent each in the proposed venture. Later, the Bengal mineral corporation will sell 10 per cent to West Bengal Power Development Corporation, while NMDC will be free to induct a foreign partner with a 10-15 per cent stake. “Ultimately, it will be a commercial decision,” Som said. Chinese firms may also join the project, he added. The process of forming a joint venture company will begin only after the Centre formally offers the lease. The block is spread over 9.7 square kilometres but NMDC will start with 3.2 sq km where 450 million tonnes of coal is available at a depth of 100 metres. The first task is overburdening, removing earth, mainly basalt rock, to reach coal seam. “The coal will be used for power generation. It will take about 5-6 years to start production,” Bengal industry secretary Sabyasachi Sen, who was present at the MoU signing ceremony, said. NMDC and WBMTDC signed another MoU whereby the former would supply iron ore and bauxite to help local steel and aluminium industries. Bengal chief minister Buddhadeb Bhattacharjee and Union steel minister Ram Vilas Paswan were present during the signing of the pacts. Iron ore price Som said there could be a revision in the price of iron ore in the domestic market. The company board will meet on November 25 and take a decision. There is a price provision clause in the long-term contract between NMDC and steel makers if spot prices go up or down by 25 per cent. “Some of our buyers, like sponge iron companies, are in distress. We have to keep everybody in mind,” he said. ---www.telegraphindia.com