Andhra Pradesh Mineral Development Corp (APMDC) signed a memorandum of understanding (MoU) with KIOCL and RINL for exploration and exploitation of iron ore in Nemalkal and Hiradahalu village of Anantapur district.

The agreement also includes setting up of beneficiation and pelletisation plants of 1.2 mn tpa each in Anantpur district. The mining, beneficiation and pelletisation plants would cost around Rs 1,000-1,500 crore.

According to the agreement, APMDC and KIOCL would jointly conduct exploration to establish the iron ore reserves. APMDC will hold lease for the mines. Pellets manufactured by the KIOCL will be supplied to RINL on mutually agreeable terms.

KIOCL and APMDC will set up a joint venture to carry out mining with 51 per cent and 49 per cent stakes respectively. On commissioning of the plant, pellets will be supplied to RNIL on mutually agreeable terms.

According to projections, 36 months of time is required to begin the production of iron ore and beneficiation and pelletisation plants.

The project will provide employment (directly and indirectly) to about 3,500 people, besides promoting several ancillary industries in this area.

The estimated reserves as per exploratory work are approximately 30 to 35 million tonnes, consisting of both haematite and magnetite ores with a life span of 20 years.