Hindustan Zinc to invest Rs 2,000 cr in Rajasthan mines

SURESH P. IYENGAR, THE HINDU BUSINESS LINE

Contracts awarded to South African, Chinese firms

MUMBAI, JUNE 28:
Hindustan Zinc plans to invest about Rs 2,016 crore ($360 million) to improve mining operations at its Rampura Agucha and Sindesar Khurd (SK) zinc mines in Rajasthan.

The contracts have been awarded to South Africa-based Shaft Sinkers and two Chinese companies NFC (China Nonferrous Metal Industry’s Foreign Engineering & Construction Co Ltd) and CCN5C (China Coal 5 Construction Co Ltd).

Mr Akhilesh Joshi, Chief Executive Officer, Hindustan Zinc, said the money required for the project will be funded through internal accruals.

UNDERGROUND MINING

The Vedanta Group company had cash and cash equivalents of about Rs 18,000 crore as of March 31, 2012. The projects are scheduled to be completed in 2017. Mining at Rampura Agucha is being done from the open pit. This can be in operation till 372 metres below the surface.

But the mineral reserves and resources below the open pit operating level are to be extracted by suitable underground mining methods, explained a company spokesperson. The company zeroed in on a vertical hoisting shaft with crushing system after a detailed haulage assessment.

It was found that this method would be most economical to handle underground ore. The hoisting shaft will also act as a ventilation intake to bring fresh air to the mine production area, he said.

The shaft will reach a depth of 950 metres and will be 7.5 metres in width.

There will be two silos — one for storing ore and one for waste rock. The world’s largest zinc producing mine, in Rampura Agucha, has proven reserves 110.4 million tonnes (mt).

About 6.15 mtpa of ore is currently extracted from the mine.

CONTRACT TO NFC

Mining at the silver content-rich SK mine has gone up from 0.3 mtpa to two mtpa in last six years. It has reserve of 81.3 mt. The shaft at this mine will be 7.5 metre wide and about 1050 metres deep.

NFC has been awarded the $111-million contract which includes engineering contract of $5 million for five years.

The company produced 240 tonnes of silver in FY12. The country’s largest silver producer, Hindustan Zinc hopes to rank among top 10 silver producers when its output increases to 500 tonnes by FY14.

It has set up a silver refinery of 518 tonnes per annum to process the silver extracted from this mine.