States to mine deep this time, auction of 12 non-coal blocks to fetch Rs42,892 crore

NEW DELHI: Auction of 12 non-coal blocks will fetch the host state governments revenue of Rs42,892 crore over the next 50 years. Six state governments — Karnataka, Rajasthan, Andhra Pradesh, Odisha, Chhattisgarh and Jharkhand — will earn Rs36,654 crore revenue in addition to the Rs6,238 crore royalty and funds over the 50 years of life of the auctioned mines, said a senior official in the mines ministry that handholds the states for the bidding process.

JSW Steel won three of the four iron ore mines in Karnataka auctioned between October 1 till late night on Tuesday. It won two Tungabhadra iron ore blocks by offering 81% premium for one block and 58.90% for another. On October 1, it bagged the Rama Rao Paol mine in the state at 90.82% premium over average price.

Baldota Group’s MSPL won Lakshminarayanan mine in Karnataka offering an aggressive bid at a premium of 100% over the average price. The mine has 10 million tonnes of reserves. Bidding for two more mines including one diamond mine in Madhya Pradesh and one iron ore mine in Karnataka was on at the time of this report going to press.




The Hatupur mine in Panna district, first diamond block to be auctioned, is spread over 133 hectares with expected 0.604 million tonnes of reserves of 10.20 carat diamonds. Currently, the Panna mine run by state-owned NMDC Ltd is the only operational diamond mine in the country. Bidding for Hotur Traders mine in Karnataka was also going on, the official said.

Essar Steel had in February won the Ghoraburhani-Sagasahi iron ore mine in Odisha, the first iron ore to be auctioned by the government, offering a premium of 44.35% of the average price. Anil Agarwal-led Vedanta had emerged as highest bidder for Baghmara gold mine in Chhattisgarh. Vedanta had put in the highest bid of 12.55% of Indian Bureau of Mining price of Rs74,712 per troy ounce. One troy ounce is equal to 31.10 gram. The government expects to auction over 50 mines by the end of this fiscal.