india's nmdc plans to commission 3 iron ore mi, page-3

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NMDC plans to diversify, buy mines abroad

By Vikas Srivastav Mar 04 2010 , MUMBAI
Tags: Abroad, Buy, diversify, Mines, NMDC, Plans, Stock Market
The government-owned mining company NMDC, which is hoping to mop up around Rs 14,000crore from its follow-on public offer (FPO) opening on March 10, plans to diversify big time into areas like mining of rock phosphate and potash used in fertiliser industry.

Rana Som, chairman, NMDC, said, “True to the company’s name, we plan to diversify into mining of other minerals of fertiliser such as rock phosphate and potash, and not just stick to iron ore."

According to company officials, NMDC is looking for mines in countries like Brazil, Canada, Russia, Belarus and Australia.

“All I can say is that there are only four or five countries where these mines exist, so it has to be them, ” Som said.

NMDC Global is helping in acquiring overseas properties especially in the field of coal, manganese and iron ore. The same would help in exploring the fertiliser mines too, he said.

Besides, the company is also planning to buy equity stake in coal mines abroad largely to secure the coal requirement for its upcoming two steel plants with a total capacity of 5 million tonnes per annum in Chattishgarh and Karnataka.

“We are looking at acquiring coal mines abroad and are exploring all options in Africa, Australia and Latin America,” Atul Chaturvedi, secretary steel, told Financial Chronicle.

“The objective is to secure the requirement for NMDC and also to sell to companies like Steel Authority of India (SAIL) as they would have huge requirement of coal due to massive expansion plans,” he said.

Apart from coal and fertiliser mineral mines, the company is also acquiring four new iron ore mines within the country to meet the growing demand from the steel companies within India and the huge demand from China.

The company said of its total production of iron ore 85 percent is consumed in India while only 15 per cent gets exported to countries like Japan, South Korea and China.

NMDC has planned a capital expenditure of Rs 26,500 crore for the five year period.