Chile gave away cash to copper miners. The world’s top producing nation is subsidizing producers by up to $0.10 per pound of metal.
What A Mining-Friendly India Means For You
Lots of news about India this week — with the leading item being the government’s proposed tender of up to 80 historic gold mines across the country.
Geologically, there’s no doubt that India has a lot of potential. The country hosts large swaths of Archean cratonic rocks — of the kind that are immensely productive for gold, copper, nickel and other metals in Canada, Brazil, Australia and Russia.
But despite good rocks, India’s mines — and its exploration potential — have largely remained an unknown quantity for the Western mining industry.
Because of how difficult it’s been to work in the country for the last few decades (some would even say longer than that).
India’s exploration and development sector has been a mess. The rules on new projects are confusing at best, and downright dysfunctional at worst — with bizarre features like restrictions on the yearly meterage for drilling.
That’s led all but a handful of juniors to avoid the country. And the ones that have stayed have spent as much time handling red tape as they have putting boots on the ground.
But today there’s hope — perhaps for the first time ever.
Moves such as the proposed gold mine tender are some of the first indications that the new government of Prime Minister Modi is trying to change things in the minerals sector.
Add that to recent announcements about exploration blocks being identified for licensing across the country, and it looks as if the government is making an honest push to get things happening.
Of course, there are a lot of obstacles to overcome. Perhaps the biggest being the notorious and widespread corruption inside India’s civil service. Stories are rife about would-be explorers being asked to pay up millions in bribes, just to get a foothold in an exploration tenement.
But a little-reported piece of news late this week suggests that’s change too.
Local press reported that the Mining Secretary of key mining state Rajasthan was arrested by India’s Anti-Corruption Bureau. With the official being implicated for a bribery ring that has stretched throughout mining operations in the region.
This at least shows a willingness in the “new India” to take on corrupt officials. With a clean-up in this area having the potential to finally streamline the process for obtaining and working exploration licenses.
The prize may be worth the wait. In addition to proven potential in gold (the Kolar Gold Fields alone produced over 25 million ounces of high-grade ore), India also has great promise for numerous other commodities — being a notable producer of coal, iron ore and chromite.
Chromite is especially notable. Not just as a stand-alone target, but also because it suggests potential for another rare metal — platinum.
Only a few nations on Earth produce significant amounts of chromite. With South Africa being far-and-away the world’s largest source.
And in that country, the chromite is intimately related to igneous bodies that also host the world’s largest platinum reserves.
India has indeed shown potential for platinum — I’ve personally reviewed government exploration projects in the country that show some of the best grades of platinum group metals going anywhere in the world.
Few of these targets have received much attention — mainly due to the difficulty of getting things done on the ground here. But if the current reforms in the mining sector do get traction, that could change over the coming months.
It’s thus an interesting time to start looking at such works. There simply aren’t a lot of platinum prospects on the planet — and India could represent a sort of “final frontier” for a metal that sorely needs a new global production center.
This is one to keep an eye on. We’ll see if officials can really make the changes the exploration sector needs in order to flourish.