Companies Economy Live June 7, 2025 0 Comments

GMDC to operationalise new lignite mines by 2026-27

GMDC aims to operationalise new lignite mines by 2026-27 to meet growing demand for fuel in industries.

Left with four operational lignite mines, Gujarat Mineral Development Corporation (GMDC) is looking to operationalise some of six new lignite mines by financial year 2026-27.

“Till last year, we had five existing lignite mines. Now, we have only four, one has closed down. By the turn of this decade, we would have only one which is growing and probably 1 or 2 which are petering out, so production from these mines would be nearing exhaustion,” said Roopwant Singh (IAS), Managing Director, GMDC. The lignite mines at Mata No Madh, Umarsar, Tadkeshwar, Rajpardi and Bhavnagar form the backbone of operations of the company.

“This year we are looking at a growth of 10-15 per cent in the existing lignite business from our four existing mines. As far as the six new lignite mines are concerned, a lot of progress has been made on the larger ones, which are going to deliver major volumes, i.e Lakhpat in Kutch, Walia and Damlai in Bharuch. They are undergoing various stages of statutory clearances, but again, these are large and long gestation projects. We will see a lot of progress, some expenditure there, volumes next year onwards,” he recently told investors.

During FY 2025, GMDC produced 8.1 million tonnes per annum of lignite. It fell short of the mining target of 10 million tonnes per annum (MTPA). “We fell short of 10 MTPA. It was an ambitious target. It happened on account of two factors beyond our control. Our fifth and smallest mine — Rajpardi — had a safety incident and we had to close that mine subsequent to that incident. We lost some volume there. Secondly, a major ramp-up was expected from our Bhavnagar project… We could not proceed on it (second part of the package) because of late land acquisition for two villages. That has been resolved now. This year we are looking at a growth of 10-15 per cent in the existing lignite business from our four existing mines,” Singh said. However, by the year 2035, GMDC expects lignite production to reach 15 million tons from Gujarat-based lignite. About 70 per cent of the projected volumes is expected to flow from the six new lignite mines.

The six new mines have a total lignite reserve of around 400 million tonnes. Of the six projects, three of them — Lakhpat, Bharkhandam and Panandhro Extension — are in Kutch district and are “dual mineral” projects. Cumulatively, they have 135 million tonnes of lignite and 1800 million tonnes of limestone. The other three new projects are in South Gujarat. The biggest of these six mines is the lignite mine in Valia in Bharuch district, having reserves of 200 million tonnes. In the same district is Damlai mine with reserves of 35 million tonnes. In neighbouring Surat district is Ghala block with 17 million tonnes of lignite reserves. These six mines have a life span of 10-30 years.

Talking about the demand for lignite among industries that use the mineral as a fuel, Singh said, “Our market surveys and analysis say there is demand for this fuel, and it gets sold along with and as a competition to domestic and imported coal, so this continues to stay relevant. As we ramp up our production, we are going to initiate efforts beyond Gujarat-sales also. That is an initiative that you should be unfolding in this current year,” he added.