Rajasthan
Rajasthan: ‘raj Potash Mines To Benefit From Surge In Import Prices’ | Jaipur News
Jaipur: After floating a tender for offering two potash blocks for both exploration and mining (composite licence), the department of mines is expecting big mining companies like Adani and Vedanta among others to put in their bids.
Department officials said that the sharp surge in prices of potash internationally has made the mining of the domestic mineral resource economically viable. Currently, most of the country’s requirement of potash, which is used as fertilizer, is met by imports.
ACS mines and petroleum Veenu Gupta said, “The auction process for composite license of potash in Churu and Karauli districts has started. As per preliminary assessments, Rajasthan perhaps has over 90% potash deposits and the auctions of mineral blocks for commercial licences are happening for the first time in the country.”
Three decades ago, the Geological Survey of India discovered about 2,400 million tonnes of potash resources (not reserves) containing about 4% of the mineral in the Nagaur-Ganganagar basin at a depth of 450-750 metres. Because of the depth, unlike in other countries where the mineral is found just below the surface, mining was not economically viable. Also, the minerals here are not soluble, leaving no scope for pumping up instead of costlier choice mining.
However, over the past few years, the global prices of potash have remained at elevated levels after hitting a record $1200 per tonne in April last year. While the prices have come down to $340, they are still above the trend rates of $200.
Sandesh Nayak, director of the department of mines and geology, said, “The higher import prices have made the domestic mining of potash competitive. That’s why we are expecting big players in the industry like Adani and Vedanta to join the auctions.”
Recently, the Centre brought potash under the critical mineral category.
Nayak also said that, if necessary, potash exploration and mining should be given viability gap funding. “Our tax rates for the mining industry are as high as 60%. We need to bring down the rates. For potash, given its importance and how we are reliant on imports, VGF is an option that needs to be explored.”
He said after the auctions, the winning companies would take three-four years for mining of the mineral. Both Gupta and Nayak were speaking at an event by Economic Times in the city on Friday.
Department officials said that the sharp surge in prices of potash internationally has made the mining of the domestic mineral resource economically viable. Currently, most of the country’s requirement of potash, which is used as fertilizer, is met by imports.
ACS mines and petroleum Veenu Gupta said, “The auction process for composite license of potash in Churu and Karauli districts has started. As per preliminary assessments, Rajasthan perhaps has over 90% potash deposits and the auctions of mineral blocks for commercial licences are happening for the first time in the country.”
Three decades ago, the Geological Survey of India discovered about 2,400 million tonnes of potash resources (not reserves) containing about 4% of the mineral in the Nagaur-Ganganagar basin at a depth of 450-750 metres. Because of the depth, unlike in other countries where the mineral is found just below the surface, mining was not economically viable. Also, the minerals here are not soluble, leaving no scope for pumping up instead of costlier choice mining.
However, over the past few years, the global prices of potash have remained at elevated levels after hitting a record $1200 per tonne in April last year. While the prices have come down to $340, they are still above the trend rates of $200.
Sandesh Nayak, director of the department of mines and geology, said, “The higher import prices have made the domestic mining of potash competitive. That’s why we are expecting big players in the industry like Adani and Vedanta to join the auctions.”
Recently, the Centre brought potash under the critical mineral category.
Nayak also said that, if necessary, potash exploration and mining should be given viability gap funding. “Our tax rates for the mining industry are as high as 60%. We need to bring down the rates. For potash, given its importance and how we are reliant on imports, VGF is an option that needs to be explored.”
He said after the auctions, the winning companies would take three-four years for mining of the mineral. Both Gupta and Nayak were speaking at an event by Economic Times in the city on Friday.
