To undertake mining activities in Jharkhand through this JV.
Public sector mineral resources company NMDC is all set to form a joint venture with the Jharkhand State Mineral Development Corporation within a fortnight.
“The Jharkhand government has already cleared the JV and I met the state governor and the chief secretary recently to discuss it,” NMDC chairman and managing director, Rana Som, told Business Standard.
At present, NMDC does not have a presence in Jharkhand and the joint venture will pave the way for the country's largest iron ore producer to foray into the state. “All the mining activities in Jharkhand will be undertaken through this JV,” Som said.
According to Som, NMDC’s long-term strategy is to have “a number of satellite companies,” which would work under the umbrella of the public sector undertaking. Multiple joint venture companies will be formed, where NMDC will have an equal or a majority share.
For instance, he said, NMDC had forged a joint venture with Jammu and Kashmir Minerals Limited for mining of magnesite. Similarly, it had set up a 50:50 JV with Steel Authority of India for mining of limestone in Himachal Pradesh.
These apart, NMDC has a joint venture with Rashtriya Chemicals and Fertiliser for rock phosphate mining. It has also entered into a memorandum of understanding (MoU) with the global mining major Rio Tinto for a joint venture aimed at developing mines in domestic and international markets. An MoU has also been signed for a joint venture with Spice Minerals and Metals, part of the Spice Energy group.
With regard to iron ore prices, Som said international prices were expected to be settled by July-August. “The benchmark for domestic prices are international prices. So, till international prices are settled, domestic prices can't be settled,” he said.
During 2008-09, NMDC posted a net profit of Rs 4,350 crore, a 34 per cent rise compared with previous year's profit of Rs 3,251 crore. Its turnover increased 31 per cent to Rs 7,500 crore from Rs 5,711 crore in 2007-08.
