India on Monday announced the results for the country’s first critical mineral auction.
Amid the tepid response from big players, the list of successful bidders included some lesser known names.
A total of five companies secured bids for six critical mineral blocks of graphite, manganese, phosphorite, lithium, and rare earth elements with auction premiums ranging from 13.05 per cent to 400 per cent.
These blocks are situated across Odisha, Tamil Nadu, Uttar Pradesh, and Chhattisgarh.
An auction premium refers to the additional financial commitment that a bidder agrees to pay over and above a predetermined base price or reserve price set by the government or the auctioning authority.
This premium is typically expressed as a percentage of the mineral revenue generated from mining operations.
No big names, cancelled bids mar first tranche
The current Union Mines Minister G Kishan Reddy praised the auction as a success, heralding a significant step towards achieving self-sufficiency in critical minerals.
However, sector experts argue that the absence of major players among the winners suggests a lack of confidence in the country's efforts to mine critical minerals.
“Major mining companies participated in the auction, yet only one succeeded in securing a contract.
"This highlights the industry’s scepticism regarding the viability of critical mineral mining in the country,” a sector expert said.
The results announced on Monday revealed that five companies—Agrasen Sponge, Kundan Gold Mines, Dalmia Bharat Refractories, Sagar Stone Industries, and Maiki South Mining—secured bids for six critical mineral blocks encompassing graphite, manganese, phosphorite, lithium, and rare earth elements with auction premiums ranging from 13.05 per cent to 400 per cent.
These blocks are situated across Odisha, Tamil Nadu, Uttar Pradesh, and Chhattisgarh.
An auction premium refers to the additional financial commitment that a bidder agrees to pay over and above a predetermined base price or reserve price set by the government or the auctioning authority.
This premium is typically expressed as a percentage of the mineral revenue generated from mining operations.
The highest premium of 400 per cent was paid for phosphorite.
Phosphorite is vital for fertiliser production, supporting global agriculture.
Graphite is crucial for lithium-ion batteries used in electric vehicles and renewable energy storage.
Lithium is integral to rechargeable batteries, powering smartphones, laptops, and electric vehicles.
Rare earth elements are critical for manufacturing electronics, magnets, and catalysts, essential in modern technology and clean energy applications.
Manganese is essential in steelmaking for its ability to improve strength and hardness.
Who’s who?
Dalmia Bharat Refractories Limited (DBRL), the sole major player securing a block in the auction, brings a wealth of experience to the table. DBRL secured the Iluppakudi Graphite Block in Tamil Nadu at an auction premium of 45 per cent.
The Dalmia Group has a presence in Cement business in the country. Graphite is crucial for lithium-ion batteries.
Founded in 1939, DBRL has a long history with high-temperature materials.
However, they recently transferred its entire India business to RHI Magnesita (RHIM), the world’s top refractory business player and are now seeking new ventures, the company said in its annual report.
Their success in the auction suggests they see critical minerals as a strategic addition to their portfolio, potentially leveraging their existing expertise in mining and processing to become a key player in this burgeoning sector.
Agrasen Sponge Private Limited, with two decades of experience in manufacturing basic iron and steel became the only company to secure two blocks in the recent auction.
The Odisha-based company, incorporated in 2003, won bids for two graphite and manganese mines, boasting a combined resource capacity of 4.57 million tonnes in Odisha.
The firm is led by directors Raj Kumar Dadhichi and Murari Lal Sharma, according to Zauba, a global trade data company.
Agrasen Sponge’s success in securing critical minerals blocks underscores its expanding footprint in the mining sector.
Kundan Gold Mines Private Limited became another player to show interest in Odisha for mining graphite.
The company is part of the more than four-decade-old Kundan Group, which operates in gold precious metals, gold refinery, bullion import, personal care, energy, gold jewellery, and digital gold.
It paid the lowest auction premium of 13.05 per cent.
Headquartered in Delhi and led by Chairman Pradeep Garg, the company is now entering the graphite mining sector, having secured a composite licence for the Akharkata Graphite Block in Odisha.
Sagar Stone Industries of Jabalpur has become the top company to pay the highest premium for a critical minerals block.
The decade-old company secured the Pahadi Kalan-Gora Kalan Phosphorite Block in Uttar Pradesh at an impressive auction premium of 400 per cent.
Phosphorite is vital for fertiliser production.
Established in 2013, Sagar Stone Industries specialises in manufacturing iron ore fines, iron ore nano blue dust, and various sizes of iron ore products.
Maiki South Mining Private Limited, a three-year-old company based in Kolkata, has achieved a significant milestone by becoming the country’s first firm to secure a lithium mining contract.
The company successfully won the tender by offering an auction premium of 76.05 per cent.
Established in 2021, Maiki South Mining is primarily involved in the mining and agglomeration of hard coal, encompassing activities such as underground or open-cut mining of anthracite, bituminous coal, and related operations to enhance coal quality.
The company’s board of directors includes Rajiv Ganeriwala, Dilip Kumar Sharma, and Rakesh Kumar Singh.
