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Exploration firm sees good gold reserves in India
By siliconindia
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Tuesday, 13 April 2004, 19:30 IST
MUMBAI: Deccan Gold Mines Ltd said on Monday its exploration work in India, the world's largest gold importer, has yielded encouraging results and brightened prospects for commercially viable mining in the country.
India's leading private exploration firm has started drilling in the Dharwad Shimoga basin in Karnataka after testing soil and rock samples for about two years.
"This is a new virgin discovery by us after starting a major drilling programme in India," chairman Charles Devenish told Reuters in a telephone interview.
India, the world's largest gold consumer, imports 70 per cent of its needs of about 800 tonne a year, with most of the remainder coming from recycling of gold.
India produced just 9.02 tonne of gold between April 2003 and February 2004, up from 7.59 tonne in the corresponding period of the previous year, according to Government figures.
State-run Hutti Gold Mines Ltd, the only firm processing gold in India from the ore stage, produced 2.79 tonne during the period. Copper makers Hindalco Industries Ltd and Hindustan Copper Ltd, which get gold as a by-product of refining, produced 6.04 tonne and 195 kgs of gold respectively.
Industry experts say annual gold output in India could grow to between 200 and 300 tonne in a decade as the Government has liberalised the sector. It opened mining to the domestic private sector in 1993 and by 1999, it had allowed foreign investment.
Devenish said preliminary drilling results showed that the Dharwad basin could yield an average 3.9 grams of gold per tonne of ore after mining. Open-pittable mines with gold of more than 2.9 grams per tonne could be recoverable, he said.
"Our aim is to produce 100,000 ounce of gold a year (around 3.1 tonne) for a minimum of five years from Dharwad mines, subject to a programme of deep drilling," Devenish said.
The company also plans to undertake drilling operations in the Hutti basin, which is also in Karnataka.
"Hutti basin has a good potential for gold mining and we plan to start drilling in the area in a couple of months," he said.
Deccan was established in India about 10 years ago, but it seriously started exploration around two years ago.
"Though we have aimed to produce about one million ounces of gold every year in India, we will be happy if we get 200,000 to 300,000 ounce a year after starting mining operations," he said.