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Shree Cement wins maiden non-coal mining lease under auction route

Shree Cement emerged as the highest bidder for Karhi Chandi limestone block at 58.95% of the IBM price.

February 19, 2016 8:52 IST | India Infoline News Service
Shree Cement
Shree Cement Ltd. on Thursday won the first-ever non-coal mining lease allocated through the auction route, reports a financial newspaper.

The company offered to pay the Chhattisgarh government ~INR 284 for every tonne of limestone production from the Karhi Chandi mine that has an estimated reserve of 255 million tonne (MT) spread over 242 hectares.

In addition, Shree Cement would have to pay royalty, contribute to the district mineral foundation and national mineral exploration trust once it starts mining, reports the business daily.

Commencement of mining operations might take a little over one-and-a-half years, considering the time required for land acquisition, to prepare the mining plan and to get environmental clearance, according to the paper.

Shree Cement emerged as the highest bidder for Karhi Chandi limestone block at 58.95% of the IBM price.

"It was the first non-coal mining lease auction in the country and saw aggressive bidding from cement manufacturers," Chhatiisgarh Mines Secretary Subodh Kumar Singh told the paper.

The reserve price for bidding was fixed at 5% of IBM price and the floor price was 23.60% of the IBM price.

The highest bid was 58.95% of the IBM Price.

The IBM price of limestone in Chhattisgarh was INR 483.17/tonne.

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