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De Beers gets Centre nod for Orissa recce

BS Commodities Bureau in Mumbai

The Centre has given its approval to mining major De Beers to undertake a reconnaissance mission in Orissa in search of diamond deposits, according to official sources.

The company will undertake the survey in about 9,600 sq km in western Orissa and the work is likely to start soon, the sources said.

Only recently BHP Billiton, the world's largest natural resource company, entered into a strategic alliance with the Perth-based Dwyka Diamonds for a major diamond exploration project in India.

The move was prompted by the new national minerals policy, which has also resulted in interest shown by other multinationals like Rio Tinto and De Beers. India contributes 55 per cent to world diamond production in terms of value.

The permission was accorded to De Beers following recommendations of the state government.

The reconnaissance would be undertaken in parts of Kalahandi, Nuapada, Balangir, Bargarh and Nawarangpur districts and along the course of the Mahanadi river over the next three years.

The sources said that De Beers is expected to identify a 25 sq km patch to commence prospecting work before the reconnaissance work is completed.

However, De Beers would not automatically get the prospecting licence on completion of reconnaissance but would receive priority as an applicant for the same.

The state government, however, could allow the company to dig out diamonds on completion of the prospecting work, the sources said.

Since long the Mahanadi river bed has been considered to be containing diamond and the state government, with technical assistance of the world geo-science corporation of Australia, had conducted a aero-magnetic survey over an area of 75,000 sq km, mostly in the mineral-rich western Orissa.

The data collected through the exercise could be used by companies getting reconnaissance permits, the sources said.

The directorate of geology had established the potential of Nuapada as a diamond rich area while Kimberlite pipes had been found in Kalahandi, Bargarh and Nawarangpur districts adjoining Chhatishgarh.

Proposals of ACC, Rio Tinto and Amil Mining had been received by the state which had recommended them to the ministry of mines for reconnaissance permits.

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