Adani sets up contract mining arm to extract iron ore at Bailadila for NMDC joint venture

Adani Group has incorporated a new wholly-owned subsidiary Bailadila Iron Ore Mining Private Ltd as a special purpose vehicle for Adani Enterprises Ltd (AEL) which will act as a contract miner for a major new iron ore mine in India. The new company has been set up to develop the Bailadila deposit #13 which is close to the existing NMDC Bailadila #14 operations in the Kirandul area of Chhattisgarh state. The new Bailadila operation is expected to mine 2 Mt/y ramping up to 10 Mt/y, and has reserves of over 300 Mt.

“The company has incorporated a wholly owned subsidiary namely, ‘Bailadila Iron Ore Mining Private Limited’ (BIOMPL) on September 20, 2018,” Adani said. AEL was the successful bidder to be the mine developer-cum-operator (MOO) for the Bailadila Iron Ore Deposit, Dantewada District, Chhattisgarh, by NMDC-CMDC. This stands for NMDC-Chhattisgarh Mineral Development Corporation Ltd (NCL), a 51:49 joint venture between NMDC and CMDC Ltd.

As per the tender, an Iron Ore Mining Services Agreement (IMSA) has to be signed within 60 days from the issuance of the LOA (letter of assurance) and AEL may form a 100% owned SPV to act as the MOO and sign the IMSA with NCL and as such SPV (special purpose vehicle) shall be formed within 30 days from the date of issue of the LOA by NCL,” the company said.