Indian Bureau of Mines (IBM) has approved state-owned NMDC Ltd’s proposal to increase production at Kumaraswamy iron ore mines to 10 million tonne per annum (MTPA) from 7 MTPA as of now. NMDC had submitted a modified mining plan to the government.
According to a government release, the approval is effective for fiscal 2020-21 and 2021-22. India’s largest iron ore producer, NMDC produces about 35 million tonnes of iron ore from its three mining complexes - two located in Chhattisgarh and one in Karnataka.
NMDC has termed the approval for its proposal to boost output at Kumaraswamy mines as "a milestone". The company is yet to get forest and environmental clearance for the said proposal.
This is the second positive development in a week for the miner. On Tuesday, the Chhattisgarh government extended leases of NMDC's four mines by another 20 years to avoid interruptions in iron ore supply to the steel sector.
The mining company has outperformed nearly all its peers in the last one year even as concerns around US-China trade war, weak global and domestic consumption, declining metal prices and the ongoing economic slowdown in India weighed on the Nifty Metal index.
Shares of the state-owned miner have risen nearly 25% in the past one year, while the Nifty Metal index slipped close to 15% during the same period.
At 11.37 am, shares of NMDC traded 0.5% higher at ₹124.10 on the BSE. The Nifty Metal index was up 0.6%.