Iron ore reserves at a mine in Karnataka have been significantly increased

The National Mining Development Corporation has revised its upper estimate for iron ore reserves at its Donimalai mine in Karnataka, owned by state-owned NMDC. It was found that the mine's potential reserves are almost seven times higher than previous figures. The estimated reserves have been increased to 111 million tonnes from the previous preliminary 17 million tonnes.

NMDC is the largest iron ore producer in the country, accounting for 18 percent of production in 2012-13. It has a production capacity of up to 32 million tons (MT) of iron ore per year. In 2013, sales of iron ore increased 17 percent to 27 million tonnes, against a target of 28 million tonnes. Expansions at mines in Karnataka, which will add about 14 million tonnes per year, are well under way. The company indicated that operations could begin within the next two quarters.

Easing the mining ban in Karnataka (Goa) will increase supplies of iron ore and could put pressure on raw material prices. NMDC is currently aiming to achieve an iron ore production capacity of up to 48 tons per year over the next two years. The company has an iron ore reserve of 1,300 tons in the state of Karnataka and most of its ore is of high quality.

The increase in discovered reserves will allow the state-owned Donimalai mine to produce about 10 million tonnes per year over the next 20 years.