India Resources Ltd has advised that the Government of Rajasthan has administratively approved the Aravalli lead-zinc Project Mining Lease (ML) in favour of IRL’s 100% owned subsidiary, Crown Mining Private Ltd (CMPL). It has also cancelled one ML and two Prospecting Licence applications from Hindustan Zinc Ltd, and one ML application from Terramine Developers Pvt Ltd that overlapped with CMPL’s ML application. IRL has already been engaged in contract mining at Hindustan Copper’s Surda mines in Jharkhand since 2007.
The Government of Rajasthan will now request the Director of Mines and Geology (DMG) Udaipur to prepare a new ML proposal for CMPL for more than 2,000 ha, representing around 90% of the original application in this highly competitive mining area. IRL said it was “very thankful that the Government of Rajasthan has taken this historical decision to recognise CMPL’s preferential rights to the Aravalli lead-zinc project.”
The DMG will scrutinise all the facts and obtain landowner consent in developing its proposal for CMPL, and then an area is expected to be offered to CMPL for its acceptance. CMPL will then be scrutinised regarding the broad parameters of the ore body, its mine and investment planning, technical skills and financial position prior to the DMG presenting this matter to the Government of Rajasthan and then the Central Government in Delhi. Once approved by both governments a Letter of Intent (LOI) for the Mining Lease can be issued to CMPL. Once the LOI has been given, CMPL will need to undertake an extensive drilling campaign to produce a detailed Mining Plan that can be approved by the Government of Rajasthan. CMPL will also need to obtain environmental clearances, forest clearances, a mine closure plan and acquire the required land for the project. Once everything is in order, an agreement can be executed with the State Government and the ML issued to allow the commencement of mining activity.
“The decision by the Government of Rajasthan is a very significant, hard fought and long awaited step for IRL. Aravalli is a world class project, and accordingly a tremendous amount of work and challenges will need to be met to achieve its development, but clearly the project is a unique opportunity for the company.”
The Aravalli project is located in the Indian State of Rajasthan and contains a significant lead-zinc occurrence. IRL has previously reported an exploration target in the range of 95-135 Mt at between 2.2-4.5% zinc and 0.7-1.8% lead. The Aravalli Exploration Target was updated to JORC 2012 compliance in the report entitled “Aravalli Project – Supplementary Update” lodged on July 23 2014. The potential quantity and grade is conceptual in nature, and there has been insufficient exploration as yet to define a Mineral Resource, and it is uncertain if further exploration will result in the determination of a Mineral Resource. Further drilling will be required to establish JORC standard estimates of Resources.
The deposit is of a SEDEX style similar to Mount Isa in Australia. There is potential to upgrade the target substantially in both tonnes and grade by further drilling and higher grade zones can be identified within it. The mineralised zone is essentially continuous with the adjacent Sindesar Khurd and Rajpura Dariba mines where grades in excess of 10% lead plus zinc are being mined by Hindustan Zinc.
