Karnataka Government Defers Auction Of NMDC’s Donimalai Iron Ore Mine
Iron ore awaits loading at a mine. (Photographer: Nelson Ching/Bloomberg News)

Karnataka Government Defers Auction Of NMDC’s Donimalai Iron Ore Mine

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The Karnataka government has deferred the auction of NMDC Ltd.’s Donimalai iron ore mine.

The development comes soon after the central government’s mines tribunal kept in abeyance the cancellation of mining lease of the block by the state extended to India’s largest iron ore miner.

“The government of Karnataka has identified one iron ore mine for electronic auction for grant of mining lease and accordingly notice inviting tender was issued dated Aug. 20, on MSTC website for Donimalai Mine,” according to a notice by the state government. “The schedule of the auction process for the said mine is hereby deferred until further notice.”

The state had earlier withdrawn the extension of the mining lease granted to NMDC for the mine in November 2018 for a 20-year period. Challenging the decision, the public sector undertaking moved the tribunal, which heard the petition on Aug. 21 and stayed the order.

NMDC had suspended operations at the seven-million-tonne-per-annum mine in November last year following the Karnataka government’s decision to decision to claim a larger share of revenue from sale of the raw material for steelmaking. In July, the Karnataka High Court had dismissed the state’s decision.

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