'Talks underway for extension of Donimalai mine lease'

State-owned National Mineral Development Corporation Limited (NMDC) on Friday said production from its Donimalai mine in Karnataka will resume soon as discussions at the higher level were underway for the extension of the mining lease.

The Donimalai mine, with a capacity of seven million tonnes per annum (MTPA), was mired in controversy over renewal resulting in the cancellation of lease last year, which subsequently suspended the production from the mine.

On likely extension of Donimalai mine lease, NMDC Director (Production) PK Satpathy said, "High-level discussions are going on. ...we are hopeful that in the coming future...one month, 15 days it can happen any time. All groundwork has been done and logically we are on the right track. So there is no point for state government to withhold our extension of lease."

Satpathy was speaking on the sidelines of Mining Summit organised by the CII.

Stating that the production from the mine would be resumed soon, he said that "discussions (on the extension of lease of the block) were going on at the higher level".

"We have been under severe threat because of this lease renewal. In government companies only there is a provision of a lease extension. (with regard to) private companies there is no such provision. No lease will be extended in 2021. They will be auctioned. But in government companies there is provision for extension of the lease," he said.

The public sector mining major, which has been in the business of mining iron ore for over six decades, operates three iron-ore complexes in the country.

While one is located in Karnataka's Donimalai, two are in Dantewada district of Chhattisgarh — contributing 70 per cent to the company's total output.