Sterlite Industries (India) Limited - Sterlite Industries India Ltd.

Bauxite Mines
Chhattisgarh Mines
The Chhattisgarh mines and deposits comprise the operating mines at Mainpat and Bodai-Daldali. Mainpat is an open-pit bauxite mine
located approximately 170 kilometers from the Korba complex in the Surguja district of the State of Chhattisgarh in central India. The Mainpat
mine was commissioned in 1993 and lies within a mining lease granted by the Government of India which is due for renewal on July 8, 2012.
The mining lease covers an area of 6.39 square kilometers. The bauxite extraction limit for the mine approved by the IBM is 750,000 tpa. The
Bodai-Daldali deposits are located approximately 260 kilometers from Korba in the Kawardhha district of the State of Chhattisgarh. Bodai-
Daldali was commissioned in 2004 by BALCO and lies within a 6.3 square kilometers renewable mining lease that is valid until March 27,
2017. The bauxite extraction limit for Bodai-Daldali approved by the IBM is 1,250,000 tpa.
The Chhattisgarh bauxite deposits are situated on a series of steep sided plateau at an elevation of approximately 1,000 meters, for Mainpat,
and approximately 500 meters, for Bodai-Daldali, above the surrounding land. The bauxite generally is one meter to three meters thick and lies
within a laterite sequence overlying thick Tertiary basalts of the Deccan Traps. The cover of laterite and thin topsoil is up to five meters thick
but is generally less than two meters. The bauxite outcrops around much of the plateau rims and is also visible as boulders strewn across fields
topping the edge of the plateau.
A typical profile of the Chhattisgarh deposits comprises topsoil and soft overburden above the laterite. The upper laterite consists of hard,
loose or indurated bauxite pebbles and boulders with a clear contact with the underlying hard bauxites. The bauxite occurs in discontinuous
lenses up to six meters in thickness with laterite infilling joints and fractures with the bauxite. The contact with the softer lower laterite is
usually gradational and irregular.
The bauxite is hard to very hard with a natural moisture content of 5% to 10%, an in-situ density of 2.3 tons to 2.4 tons per cubic meter and
a low porosity (less than 2%). It comprises primarily gibbsite with boehmite and minor diaspore. The reactive silica content is low and iron is
present in the form of hematite and aluminous goethite. The average grade of the bauxite is, at present, approximately 47% aluminum oxide
(available alumina is approximately 41%) and silica levels of less than 4%.
All mining and transportation at Mainpat is undertaken by contractors. One thin top soil layer is removed by excavator and is either
transported to an adjacent storage point or an area that is being backfilled. The laterite layer is drilled and blasted. The overburden is then
removed by backhoe excavators and 15-ton trucks. Broken ore is hand-sorted, leaving waste material behind. Ore productivity is around two
tons per person per day in the dry season, dropping to around 1.25 tons per person per day in the wet season. Excavator loading is employed in
areas where bauxite deposit is more consistent.
The ore pile is loaded by hand into non-tipping 16 to 25-ton trucks. Loaded trucks undertake a one-way trip of approximately 210
kilometers via public roads to the offloading point at BALCO’s Korba plant. The journey takes approximately six to seven hours depending
upon truck condition and road conditions which are highly variable, ranging from seven-meter wide, drained, cambered, smooth bitumen
highways to non-surfaced, ungraded, three meter wide dirt tracks. In May 2009, BALCO commissioned an extensive road building and
improvement program to reduce the average one-way haul distance from approximately 250 kilometers to approximately 140 kilometers. At
Mainpat’s processing site, the trucks are unloaded manually and the bauxite is bulldozed onto an armored pan feeder conveyor, where it is fed
into the crusher.
The current exploration drilling program is based on a 50-meter square pattern and is reduced to 25 meter centers for detailed mine
planning. Sampling is normally in 0.40 meter lengths and core is currently split and retained for future reference. Bauxite samples are tested for
silica and aluminum oxide at laboratories situated on site and at the Korba plant. Selected samples are re-assayed as part of a quality control
program.
Since commencing operations, the Mainpat mine has produced approximately 5.5 million tons of bauxite, with production in fiscal 2009
totaling approximately 571,422 tons at 44.7% aluminum oxide. Our operations are subject to extensive governmental and environmental
regulations which have in the past and could in the future cause us to incur significant costs or liabilities or interrupt or close our operations.
Power and water requirements at Mainpat are minimal and can be supplied by small on-site diesel generators and from boreholes in the
mine.
BALCO estimates the reserves at Mainpat as of March 31, 2009 to be 3.3 million tons and, based on current and anticipated production
rates, expects that the mine will continue to operate for approximately five years from April 1, 2009.
Total production at the Bodai-Daldali mine since the commencement of production has been 1,220,847 tons of bauxite, with production in
fiscal 2009 totaling approximately 300,250 tons at 49.1% aluminum oxide. As at the Mainpat mine, manual sorting and sizing of ore is carried
out due to the bauxite occurring as boulders, though trials for mechanized crushing and screening on-site are planned. Power is supplied by onsite
diesel generators and ground water provides the water requirements for the mine.
BALCO estimates the reserves at Bodai-Daldali as of March 31, 2009 to be 3.8 million tons and, based on current and anticipated
production rates, expects that the mine will continue to operate for approximately five years from April 1, 2009.
A cut-off grade of 44% aluminum oxide was used to define the reserves at BALCO’s mines, which cut-off grade was primarily defined by
geological limits. As the bauxite is hand-sorted and the mining recovery adjustment factor is based on reconciliation studies, there is a high
degree of confidence in the cut-off limits. Also, BALCO’s operations are vertically integrated and all bauxite mined at the Mainpat and Bodai-
Daldali mines is only suitable for use at BALCO’s Korba alumina refinery. Consequently, the economic feasibility of the reserves depends on
the economic feasibility of the company. Based on current costs and historical prices, BALCO’s operations are forecast to remain profitable
and therefore the deposits at the Mainpat and Bodai-Daldali mines fulfill the requirements for being classified as reserves.
48