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India to invite foreign firms to restart defunct gold mines

19th July 2013

By: Ajoy K Das

Creamer Media Correspondent

  

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The Indian government will soon invite foreign mine developers and operators (MDOs) to restart the Kolar gold mines, which have been lying dormant for the last 12 years.

An official in India’s Mines Ministry, which owns the Kolar gold mines, located in the southern province of Karnataka, through government-owned Bharat Gold Mines Limited (BGML), says the government will float global tenders to attract MDOs to invest in and restart operations at the mines.

This follows a Supreme Court order, which permits the Indian government to involve foreign miners in the mines, while dismissing a series of legal challenges brought by BGML employees over the past decade, the official said.

Last week,

India’s apex court ruled that the government could proceed with implementing the Cabinet’s decision to restart the Kolar gold mines but that it would have to categorically clarify to the MDOs that the lease to mine gold at Kolar had been granted to BGML which, in turn, had subleased part of the 12 095 acres of property to mining equipment manufacturer Bharat Earth Movers. This sublease is to expire only in 2014.

Meanwhile, officials from the Geological Survey of India (GSI) have expressed caution over the feasibility of reviving the Kolar operations.

According to one GSI official, a significant capital investment will be required to restart the gold mines, where operations stopped 12 years ago owing to poor-quality ore and the limited remaining resource.

Edited by Martin Zhuwakinyu
Creamer Media Magazine Managing Editor

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