Tata Metaliks gets license to prospect for iron ore in Maharashtra
04 Feb 2009
Tata Group company Tata Metaliks Ltd (TML), has received a prospecting licence from the Maharashtra government for taking up initial exploration for iron ore mining in Sindhudurg.
The Maharashtra government has conveyed approval of central government for grant of prospecting licence to the company for iron ore over an area of 154.80 hectares in Dongarpal village under Tahsil-Sawantwadi in Maharashtra's Sindhudurg district for a period of two years, TML said in a filing with the Bombay Stock Exchange.
The prospecting licence, which would give the the company the much needed security in terms of raw material supply, comes in the wake of a global fall in steel demand. Steel prices also fell across markets amidst volatile raw material prices.
TML, which produces pig iron, expects captive mines to help reduce its raw material cost by almost Rs2,500 per tonne. Captive mining would also spare the company of price volatility linked to dependence on market purchases.
Tata Metaliks, which requires nearly 11 lakh tonnes of iron ore every year, expects to complete exploration job within the stipulated 18 months.
At present, TML buys nearly five lakh tonne of iron ore every year. Some 50 per cent of its requirement is sourced from Tata Steel while the remaining amount is purchased from the market.