New Delhi, Nov 4 (UNI) TRIMEX Industries (TRIMEX) has secured the Andhra Pradesh government's approval to commence ilmenite mining operations in the next two months in the Srikurmam district of the state, spanning an area 7.2 sq km of land area.
According to a company statement issued here today, a Memorandum of Understanding (MoU) was signed with the state government way back in January 2001 in Hyderabad.
The area has proven reserves of 5.5 million tonnes of ilmenite.
About 50 per cent of the land area specified in the mining lease is owned by the government.
Ilmenite is used to produce titanium dioxide, a vital ingredient in creating white pigments in high-quality paints, paper and plastics. Ilmenite is also used as an intermediate feedstock in the manufacturing of titanium metals.
TRIMEX, the first Indian firm to obtain a mining lease for a period of 30 years from the date of the lease award (in 2001) which is renewable for another 30 years, will be executing mining operations and related projects through its wholly-owned subsidiary -- TRIMEX Sands Pvt Ltd.
The current capital expenditure stands at Rs 250 crore and is expected to climb to Rs 2,250 crore in five years, the statement added.
''This lease is a key development and a stepping stone for us. It gives TRIMEX the potential to emerge as one of the leading global producers of ilmenite by building upon our extensive resource base and existing competitive cost structure in India. With this lease and associated investment, we are one of the largest ilmenite producers in India,'' TRIMEX Executive Director Pradeep Koneru said.
Through this secure supply of ilmenite, TRIMEX will be one of the lowest-cost titanium dioxide manufacturers globally, by value adding and integrating our operations throughout the supply chain, he said.
''To this end, we are working to ensure that prices remain competitive to benefit the end-user.'' The company's site facility has a capacity to produce 2,00,000 tonnes of ilmenite per annum and is expected to produce 65 per cent of that capacity in the first year of operations.
Also, the facility will have an annual capacity to produce 80,000 tonnes of garnet, 80,000 tonnes of sillimenite, 6,000 tonnes of rutile and 6,000 tonnes of zircon; all of which are associated minerals in the area.
The global consumption of Titanium Dioxide pigment (TiO2) is projected to increase at a CAGR of 3 per cent from 4.96 million tonnes in 2008 to 6.25 million tonnes in 2015.
The supply of ilmenite is expected to be affected by a decline in supplies from traditional sources in Australia and North America.
India, on the other hand, is slated to become a major supplier in the global production of ilmenite and Asia will supply about 22 per cent of total world production by 20151.
India is projected to contribute at least 10 per cent of global ilmenite supply in the same timeframe.
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