40 lakh tonnes sold to Chennai-based firm for Rs. 39 a tonne
Questions are now being raised over the ‘extremely low’ price at which Hutti Gold Mines Ltd. (HGML), the only producer of primary gold in the country, sold 1,17,50,000 tonnes of Gold Ore Tailing (GOT) to Star Trace Private Ltd. (STPL).
GOT, the waste material after separating gold from the gangue of ore, from HGML is being dumped at Hutti in Raichur district and Ingaladal in Chitradurga district.
According to a Memorandum of Agreement (MoA) between HGML represented by its general manager (coordination) A.R. Walmiki, and STPL represented by chairman and managing director P.R. Maheshwaran, 70 lakh tonnes of GOT from the old dump in Hutti and 7.5 lakh tonnes from Ingaladal have been sold to STPL for Rs. 52 a tonne.
Another 40 lakh tonnes of GOT at the new dump in Hutti was sold for Rs. 39 a tonne.
The Chennai-based STPL is a manufacturer of magnetic equipment, vibrating equipment and metal detectors and the firm is not into any business related to tailing processing.
“The total value of gold in the entire GOT is over Rs. 3,000 crore,” said R. Manasaiah, president of Karnataka Raitha Sangha, estimating that the each tonne contains one gram of gold.
He pointed out that, in contrast, the Raichur Thermal Power Station (RTPS) had recently sold fly ash generated by its 8th Unit for Rs. 210 a tonne. How can GOT be priced so low, he asked.
In 2005, an attempt was made to sell GOT to Bangalore-based Vishal Global Solutions for Rs. 178 a tonne. However, the then chairman of the company, Parasmal Sukhani, did not allow the deal as the price quoted was too low. “Now the very same tailings are sold at even lower prices,” Mr. Manasaiah said.
Mr. Walmiki of HGML told The Hindu, “As per the decision of the board of directors, the tender was called for disposal of GOT. Four companies applied of which two were disqualified. Finally, it was sold to the highest bidder”. He added that the gold content in GOT was at 0.30 gram per tonne and not one gram.
Managing Director of HGML A.K. Monnappa justified the selling on four grounds: lack of space for fresh GOT, environmental hazards, expansion of mining, and obligation to Indian Bureau of Mines (IBM).
“In Hutti alone GOT dumping occupied 150 acres of land. There is no space for fresh GOT, which is being generated at 2,000 tonnes a day. We cannot go on acquiring agricultural lands for dumping,” he said.
The Dr. H. Sudarshan committee report had pointed out that environmental pollution, specifically water pollution, was being caused by dumping of GOT that has a high-level of cyanide content, Mr. Monnappa said. “The dump is sitting on land where gold-ore reefs are found. Clearing this would facilitate expansion of mining. IBM has also clearly instructed to dispose off the GOT,” he said.