By Paul Ploumis 14 Sep 2015 Last updated at 08:33:49 GMT
NEW DELHI (Scrap Monster): The Indian Mines Ministry is reportedly exploring all possible options to restart gold mining operation at the abandoned Kolar Gold Fields in the southern state of Karnataka.
According to the Balvinder Kumar, Union Mines Secretary, the Mines Ministry plans to forward a proposal before the union cabinet within a month to revive some of the oldest and deepest mines in the country. The Ministry plans to float global tenders to extract gold from not only the mines, but also from dumps of waste soil from these mines spread over a wide area. The Ministry expects that the proposed mining operations could be able to extract gold worth more than Rs 25,000 crore. Incidentally, the latest assessment report had hinted at huge quantities of extractable gold in the mine areas.
The Ministry believes that revival of mining operations may contribute significantly to the country’s economy by cutting its rising gold import bill. The country had imported around 800 tonnes last fiscal. The latest Gold Demand Trends Report released by the World Gold council (WGC) predicts the gold demand to range between 900 tonnes and 1,000 tonnes during current fiscal.
Started by a British firm in 1880, Kolar Gold Fields under the ownership of Bharat Gold Mines Limited (BGML), was closed down in the year 2001, after the company declared that heavy extraction for a long period has lead to the exhaustion of gold ore reserves in the mines. Nearly 800 tonnes of gold was extracted from these mines. The closure followed the company’s assessment that mining the remaining reserves would run up in losses. The decision left nearly 3,100 jobless.
The Karnataka State High Court had earlier in its ruling directed the Indian government to take responsibility of reviving the abandoned mine. Later, the Supreme Court had allowed Central government to float global tenders to revive mining operations at the mine. However, the Bharat Gold Mines Employees Union (BGMEU) demanded that all the 3100 around workers who lost their jobs in 2001 must still be treated as employees when mining restarts.
The Kolar Gold Fields, 110 kilometres away from the City of Bangalore is believed to be one of the largest gold reserves that has more than 200 tons of the precious metal in its depths.