SP-11: Gold Mining in India: The Way Forward

The Hutti Gold Mine is located in the northern part of Hutti - Maski Schist belt. It is the only major primary gold producing center in the country. The mine has witnessed both ancient and modern mining. The gold Reserves estimated as on 1.4.2019 is 19.72 Mt @ 4.25g/t gold up to a depth of 871m or the 27th Level in the Hutti underground mine. This Reserve is classified under Proved (111) and Probable (121) categories. The exploration programme implemented in the last few years include 16,500m of surface diamond drilling and 11,000m of underground diamond drilling. 3,890 number of drill core samples and rock chip samples have been analyzed by Fire Assay. The programmes were planned judiciously and executed in two phases. For surface exploration, the Hutti Mine area was divided into 3 blocks, viz., (i) Hutti North Block, (ii) Hutti Central Block & (iii) Hutti South Block. The evaluation of exploration data has resulted in discovery of new gold reefs in the virgin and gap areas which also led to a better understanding of the geometry of existing gold-quartz-sulphide reefs besides enhancing the resource inventory.Surface diamond drilling led to the following exploration successes; (i) discovery of the existence of a new reef called Oakley?s Reef Hanging Wall (ORH) between the Oakley?s and Prospect Reefs; (ii) indicated the merging nature of Middle and Oakley?s Reefs in the north of northern dyke; (iii) indicated the presence of hanging wall/footwall branches of the existing reefs and; (vi) revealed the existence of few blind ore shoots and un-correlated lodes. Over all, the exploration has added Measured Mineral Resource (UNFC 331) of 0.59 Mt @ 4.58g/t gold which equates to 2.7 t of gold. Exploration by diamond drilling carried out in the underground mines of the Central Block of the Hutti Mine, which is the area of present mining activity, has revealed the existence of a new reef on the foot wall side of the Middle Reef which was named Middle Reef Foot wall (MRFW). A stope in this reef between 546 and 606m in Central Shaft added a high grade proved ore Reserve of 0.70 Mt @ 8.18 g/t. Inclined boreholes drilled from Zone-I (ZI), Middle (MR) and Oakleys (OR) Reefs have proved the existence of Strike Reef (SR), ZI and MR below 31st level (930m). Overall, the underground exploration programme has added Probable Mineral Reserves (122) of 0.88Mt@2.43g/t or 2.13t of gold to the inventory. On the basis of these results further detailed exploration by mine development has been planned to delineate the geometry of the Reefs and feasibility of their mining.The above exploration successes have strengthened the Exploration Team?s prognostication of the existence of inter-reef blind ore bodies as well as branching and rejoining of the Reefs both along the dip and strike extensions of the reefs. There remains more Resources to be discovered within the currently operating domains of the Hutti mines. The exploration success has enabled the management of the Company to place greater confidence in exploration as an important and indispensable part of the mining activity and appreciate the need for providing adequate budgetary support to the Exploration Department in the interest of continuously replenishing the mined Resources and Reserves. Currently, the mine has reached a kilometer depth where four major Reefs show signs of continuity. Another phase of drilling has been planned to test the down dip continuity of all the four major reefs beyond 930m which is the current deepest level that the mine has reached.

Ajjanahalli Gold Field is a well-known BIF-hosted gold-bearing area of Karnataka. The gold prospects are hosted by the volcano-sedimentary sequence of Chitradurga Greenstone Belt in Western Dharwar Craton. The major lithologies are metabasalts, Banded Iron Formation (BIF) and argillite-greywacke of Hiriyur Formation of Chitradurga Group. Three phases of deformation have been noticed in the area. The bands are folded and repeated several times exhibiting both antiformal and synformal closures with fold axes plunging towards north. Multiple generations of quartz veins traverse all lithounits. Potentiality of gold mineralization in Ajjanahalli area has already been proved by earlier investigations in the Ajjanahalli Main Block and Western Block. Hutti Gold Mining Limited (HGML) had exploited the Ajjanahalli Main block and Western block during 1995- 2002 and recovered 963.4 kg of gold from 0.60 Mt of ore. Geological Survey of India (GSI), through systematic exploration under UNFC-G4, G3 and G2 stages is continuously augmenting the gold resource in Ajjanahalli Gold prospects. The work reframed the adjacent area of Ajjanahalli Main Block into several exploration blocks such as Ajjanahalli-A, B, C, D, E, F, G and H, Gungurpenta and Gungurpenta South. Gold Resource has been established by G3 stage of exploration in Ajjanahalli-A, B and G blocks by GSI. G3 stage of exploration is completed in block-F but no potential mineralization is established. G2 stage of exploration was carried out in blocks-C, D and E by GSI and Resource has been established. Mineral Exploration Corporation Limited (MECL) has completed G2 stage exploration in block-A. G4 stage of exploration was carried out in Gungurpenta, Gungurpenta South and Ajjanahalli-H Blocks. The total Resource in Ajjanahalli prospects is 7.34 Mt with 1.43 g/t average grade and 2.76m average width.

The geological potential of India to host gold resources is globally well known but exploration to realise the potential is grossly inadequate. This paper is an attempt to take stock of India?s Resource-Base (Reserves + Resources) of gold and it?s potential to support development of new gold mines in the near future. More than 700 ancient workings and about 200 gold prospects are spread over 12 States in the country. The Mineral Inventory by Indian Bureau of Mines indicates a resource of 654.74 tonnes of gold metal as on 1.4.2015. As per the compilation made by the author the Resource Base in the country, as at the end of March 2019, is 670 tonnes plus a Prognosticated Resource of 198 tonnes of gold metal. The annual mine production of gold is in the range of 2-3 tonnes in the last decade. Only one major gold mine located at Hutti in Raichur District of Karnataka and two of its satellite mines are in continuous operation. India is a major consumer/importer of gold to sustain its huge jewellery industry. The drain on foreign exchange reserve is to the tune of 40 billion US$ annually to import about 800t of gold. Almost all the gold occurrences, prospects and deposits in India are sited in greenstone-belts, Mesoproterozoic fold-belts and, to a minor extent, in Mesoproterozoic Sedimentary Basins. An attempt has been made in this review to present State-wise, geological belt-wise and Prospect-wise Resources and Reserves. Apart from the few prospects which have been adequately investigated, hundreds of prospects and gold occurrences spread over the country await detailed exploration involving investment of thousands of crores of rupees for defining and/or augmenting the resources and converting the known resources into mineable reserves through feasibility studies. At Rs.4000 per gram, many among the 200 known gold prospects in the country could be developed as small operations under MSME model with distinct possibility of several of them eventually developing into largescale operations like at KGF and Hutti.The recent reforms in the Policy and amendments to the Act are inadequate in so far as mineral exploration is concerned specifically precious metals. Fast-tracked implementation of the Act & Rules has been the need since decades to enable investors to freely and effectively operationalise their planned programmes of exploration and mining. Gold Exploration and Mining deserves to be dealt with under a separate National Authority-Precious Metals Authority of India (PMAI)), on par with Coal, Steel & Hydrocarbon because of huge domestic demand for gold of the order of 800 to 1000 tonnes per annum and the important role gold plays in the economy of India. PMAI would serve to facilitate and focus private investment, including FDI and, for fast tracking the currently stagnating exploration and development of new gold mines in the country.

The prominent mining jurisdictions such as Australia, Canada, South Africa and a number of other countries have their own reporting standards which are subject to evaluation and refinement from time to time under the aegis of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO). India adopted the United Nations Framework Classification (UNFC) for National Mineral Inventory (NMI) in the year 2000 and extended the use of UNFC for statutory reporting of results of exploration through legislation in 2003.The main objective of the UNFC is to create a National Inventory of Mineral Resources. There are many challenges in applying UNFC as a reporting standard in a country like India where no reporting standards existed till the adaption of UNFC. This paper makes an attempt to evaluate the suitability of UNFC as a reporting standard in the Indian context using the data presented in the exploration reports uploaded by the Indian government agencies for precious metal exploration programs.It has been observed that the reports prepared by the government agencies do not describe in sufficient detail the quality control measures adopted while executing the exploration programs. For example, the details on the procedures adopted in core orientation, borehole deviation surveys, core photography, sampling, sample preparation, assaying and QAQC are often not described in detail. In the absence of a provision for independent auditing of the procedures by a Competent Person in UNFC, the reports prepared by Indian exploration agencies will not be able to create adequate confidence among the investors on the quality of the work carried out. It is necessary to adopt the global best practices at all stages of exploration to ensure transparency, materiality and competence in the system, especially in the exploration programs for non-bulk commodities. An exploration program conducted using the CRIRSCO compliant procedures can be slotted in an appropriate UNFC class for the National Mineral Inventory purpose.