HYDERABAD: State-run KIOCL Ltd has signed an agreement with Andhra Pradesh Mineral Development Corp and RINL for exploration and exploitation of iron ore and setting up of beneficiation and pelletisation plants of 1.2 MTPA each in Anantpur district with an investment of Rs 1,000-1,500 crore.
A memorandum of understanding was signed here yesterday among three public sector undertakings - APMDC, KIOCL and RINL - for exploration and exploitation of iron ore in Nemalkal and Hiradahalu village of Anantapur district in Andhra Pradesh, according to a press release issued by the AP government.
It was signed in the presence of Chief Minister Kiran Kumar Reddy. The ground breaking ceremony will take place in August, according the KIOCL Chairman Malay Chatterjee.
As per the MoU, APMDC, which will hold the mining lease, will carry out exploration jointly with KIOCL to establish the iron ore reserves. Pellets manufactured by the KIOCL will be supplied to RINL on mutually agreeable terms.
KIOCL and APMDC will set up a joint venture to carry out mining with 51 per cent and 49 per cent stakes respectively, the release said.
On commissioning of the plant, pellets will be supplied to RNIL on mutually agreeable terms.
KIOCL, a mini ratna company under the Ministry of Steel, will invest about Rs 1,000 to 1,500 crore towards development of mines, setting up of beneficiation and pelletisation plants in Anantpur, the release added.
"As per projections, 36 months of time is required to begin the production of iron ore and beneficiation and pelletisation plants," it said.
The project will provide employment (directly and indirectly) to about 3,500 people, besides promoting several ancillary industries in this area, according to the release.
The estimated reserves as per exploratory work are approximately 30 to 35 million tonnes, consisting of both haematite and magnetite ores with a life span of 20 years, it said.
KIOCL is currently operating iron oxide pellet plant and blast furnace unit at Mangalore, Karnataka. The company is engaged in the business of manufacturing and exporting high quality iron oxide pellets and supply of pig iron for domestic market.
The Chief Minister has asked the Chairman and Managing Director of RINL to work out the possibility of establishing the steel plant in Jammalamadugu area of Kadapa district, in the land cancelled for Brahmani steel plant, the release said.