In line with global trends, the Indian iron and steel industry is witnessing a resurgence of modernization, expansion and consolidation.
While five years ago, the sector faced a worldwide slump in steel prices, the industry has emerged vibrant over the past two years. Domestic steel companies, both public and private, are surging ahead on the strength of unprecedented buoyancy in the economy and the boom in real estate and infrastructure sectors, such as roads and highways, ports and airports.
Powered by an increased demand for steel from neighboring China, where construction projects grew at 15% annually in preparation for the Olympics, the steel industry in India has grown by about 10% in the past two years, compared with the global growth rate of about 6% a year.
Not surprisingly, the four iron ore-rich states of Jharkhand, Orissa, Chhattisgarh and Karnataka are witnessing immense activities. The boom is most evident in Karnataka, which boasts nearly 40% of the India’s ore reserves, mostly in the eastern Bellary-Hospet area.
The India, Australia and UK offices of SRK are involved in more than 12 mining projects, from scoping studies and due diligence audits to brown field exploration and expansion. The India office just finished a 3-mine due diligence report to provide an independent technical base for an intended financial investment of $700 million US. The Cardiff office is also working on a multi-mine project, reviewing resources for an intended IPO listing; the India office is assisting UK with data compilation and resource auditing.
One important brown field exploration project comes from Tungabhadra Minerals Pvt. Ltd. (TMPL). The key objective of SRK’s engagement is to design a detailed exploration program and manage its implementation. TMPL aims to conduct the study and present results according to the requirements of JORC and the guidelines provided by the Australasian Code for the Reporting of Exploration Results, Mineral Resource and Ore Reserves. Dr.Louis Bucci from SRK’s Melbourne office is the JORC Qualified Person for this project.
Mining at some of these tenements dates from 1960. In the first phase three northern tenements were targeted. After the geological mapping, an initial drilling plan was executed. The mineralized bodies dip steeply and are tabular in nature. An initial drilling plan incorporates inclined holes at a grid of 100 x 100 meters to reach the indicated level of the resource. The drilling plan combines both diamond core and reverse circulation holes. SRK is currently supervising the drilling, with logging, sampling and database management work, planned to follow JORC guidelines.
