Coal India Ltd. is set to start mining iron ore as the world's biggest coal producer diversifies its core business and reduces dependence on the dirtiest of fossil fuels.
The state-run company has been declared the preferred bidder for an iron ore block in the eastern Indian state of Odisha, it said in a statement to the exchanges. The Gadadharpur block has estimated total resource of 288 million tons, it said in the filing.
Coal India is expanding into mining of other minerals and generate green power as India inches closer to achieving net zero emissions by 2070. The company has already won a graphite block in central India.
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Over the last six years, the Kolkata-based firm has secured approvals of its shareholders to foray into new businesses - including mining of critical minerals, such as lithium and cobalt, producing hydrogen and making energy storage batteries.
Demand for the iron and steel raw material is expected to explode in the South Asian nation, which has set a target to more than double steel production capacity to 500 million tons by 2047.
India's biggest steelmakers are investing billions of dollars to expand output as consumption soars in one of the world's fastest growing economies, led by infrastructure building. The burgeoning steel capacity may lift India's iron ore imports fourfold to 40 million tons by 2035, according to industry consultancy Wood Mackenzie.
Coal India has also been battling high levels of unsold inventories since last year, even though the fuel accounts for most of the nation's electricity generation. Still, its share in the country's total power output has continued to shrink with the expansion of renewables.
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The coal miner has one year to fulfill some conditions to be declared as successful bidder for the block and another three years for the execution of the mining lease, it said in the exchange filing.
(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
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