Overview of mining sector and key issues

Monali Zeya Hazra

Centre for Science and Environment New Delhi

What is mining
Mining is extraction of valuable minerals or other geological materials from the earth, usually from an ore body or seam. Materials recovered by mining include bauxite, coal, iron, copper, gold, silver, lead, limestone Mining in a wider sense comprises extraction of any non-renewable resource (e.g. petroleum, natural gas, coal)

Mineral classification
Broadly classified as: Fuel minerals - Coal, lignite, oil and gas Major minerals
Metallic minerals Iron ore, bauxite, lead, zinc, etc Non-metallic minerals limestone, manganese,

Minor minerals constitute construction material building stones, sand, marble, gravel, sandstone, etc

Basics of mining operation

Three stages operation Regional exploration to identify areas bearing deposits through aerial photography, satellite imagery, etc Reconnaissance permit Detailed exploration Invasive and involves close distance drilling, large-scale mapping and geochemical testing Prospecting license Extraction Mining lease

Types of mining
Underground mining Mineral directly mined by creating access to it through a horizontal, inclined or vertical tunnel. The underground tunnels have to be provided with roof supports to prevent them from collapsing. Recovers only 50-60 per cent of the ore Environmental friendly however more expensive Cost of underground mining 2.6 times more than surface mines Risks Fire, subsidence, flooding

Types of mining
Underground mining

Types of mining
Opencast mining Topsoil, earth, rock and other material completely removed to provide access to the ore seam. Technologies adopted
Drilling and Blasting Surface miners Rock breakers

Can yield 80-90 per cent ore recovery Cheaper but has significant environmental impacts

Types of mining
Opencast mining

Types of mining
Between 1996-2000, annual growth rate of open cast mines - 7.6 per cent compared to 0.7 per cent for underground mines More than 80 per cent mineral production comes from opencast mines Most major minerals mined by open case except coal However, even coal moving away from underground mining 85 per cent of coal production in 2005 from surface mines

Mining in India
Started 6000 years back. First recorded reference in 1774. Came of age only after independence mere Rs 58 crores in 1947. Today, worth 84211 crores. Mineral rights belong to the government State owner of minerals within their boundary while central government owner of minerals in ocean or exclusive zones. Rights to grant prospecting license and mining leases with Central Government State vested with power to grant lease for only minor minerals

Mining in India
Initially, most minerals reserved exclusively for public sector units - Late 1950s-1970s saw emergence of number of PSUs NMDC, SAIL, BGL Post liberalisation with national mineral policy 1993, 13 major minerals opened up for private sector Foreign participation in mining and exploration was allowed Procedure for grant of mineral concession simplified Following liberalisation, between 1993-94 and 2003-04, value of mineral production up by 10.8 times.

The growth story

Growth industry: 1993-2005 Iron ore production increased by 2.5 times from 60 MT annually to 155 MT; Bauxite increased from 5 MT to 12 MT; Chromite from 1 MT to 3.4 MT Coal and lignite from 260 MT to 440 MT Limestone from 80 MT to 170 MT Value of mineral production grew at CAGR of 10.7%. Just the beginning.

The growth story

Between 2002-03 to 2006-07: About 875 sq. km. area leased out for mining 600 sq. km. opened up for prospecting 560 odd mines obtained environmental clearance - 500 odd mining projects awaiting clearance New growth areasbig money minerals copper, lead, zinc, gold, diamond etc. But these are also polluting mineralslarge mines, huge tailings and big pollution

The China factor

Huge increase in demand Huge increase in price -- up 48 per cent since the beginning of 2006 Real price at 15year high

Some facts and figures

India a mineral rich country - recoverable reserves of 58 minerals (excluding fuel minerals). 85 billion tonne of mineral reserves still to be exploited Produces 90 minerals 4 fuel, 10 metallic, 50 nonmetallic, 3 atomic and 23 minor minerals. Leads the world in production of some key minerals
2nd in barites and chromite 3rd in coal and lignite, 4th in iron ore, and 6th in bauxite

Some facts and figures

Produced mineral worth Rs 84,211 crores States accounting for majority of the mineral value are Andhra Pradesh, Orissa, Jharkhand and GujaratOthers Andhra
19% Pradesh 11% Orissa 10% Jharkhand 10% Gujarat 10% West Bengal 5% Rajasthan 5% Assam 6% Maharashtra 6% Chhattisgarh 9%

Madhya Pradesh 9%

Some facts and figures

Distribution of coal reserves Jharkhand accounts for major chunk followed by Orissa
West Bengal 11% Oriss a 24% Others 1% Andhra Pradesh 7% Chhattisgarh 16%

Maharashtra 4% Madhya Pradesh 8%

Jharkhand 29 %

Some facts and figures

620,372 ha under mining of major minerals 9131 mine leases Land under coal mining with public sector 0.13 million Total land 754861 ha Sector dominated by large number of small mines
Minor minerals dominated by small and medium mines Fuel minerals dominated by large-scale public sector In metallic minerals, large-scale private sector dominate

Economic contribution
Accounts for 2.2 per cent of nations GDP Except petroleum, country largely self sufficient recent trend in imports of coking coal Exports minerals worth Rs 49911 crores 17 per cent of total value merchandised out of India Other than cut diamonds, iron ore biggest export

Economic contribution
Employment:30% reduction, but four-fold increase in mineral value
800000 700000 600000 500000 400000 300000 200000 100000 0 1996 1997 1998 1999 2000 2001 2004 2005
716183 704537 685673 658901 638741 599301 562778

556647

Employment: 60-70% reduction in potential

Employment: Will reduce further

ISSUES

Environmental Impacts - Land

Irreversibly changes land use pattern Mining in agricultural land affects local economies and lifestyle. Example: farmers in MP have become contract labourers

Some Fact - Land

7 lakh hectares of land leased out for mining coal, metallic and non-metallic minerals (excludes minor minerals) Majority of land acquired by cement sector for limestone mining is agricultural

Some Facts Land

Mine closure dominated by repair job mindset In large-scale cement sector out of 1100 ha OFFICIALLY exhausted, only 535 ha reclaimed

Mine closure: Open secret

Miners have abandoned mines govt. are footing the bill in the US under the superfund sites billions of dollars for mine closure Estimated cost of closing over a trillion dollars in the developed world No one knows how many abandoned mines in India IBM: 296 abandoned mines (also called orphaned mines) of major minerals Abandoned coal mines : 214 Total official number: 510 who will foot this bill?

Mine closure
Only in 2003 that mine closure plan as an statuary requirements to operate mines not for coal mines State of closure plans very poor 36 closure plans reviewed water bodies, stabilized dumps & plantations very few alternate landuse, nothing on social and economic rehabilitation Financial surety highly inadequate for any sort of proper closure Closure is central to mining can not ignore

Some Facts Land

There are some examples of good reclamation practise. These are however FEW and far between

Minerals and forests: Complete overlap

Top 50 mineral bearing districts forest cover onethird higher than national average Districts account for 18% of forests bulk forest 90% of Indias coal, 72% of forest land, 80% of other minerals are found in tribal areas

Minerals and forests: Complete overlap

Mining has already destroyed large tracts of forests Total forest land diverted for mining since 1980 till 2005 - 95002.68 hectares (government estimates). National consultation of Drafts Forest Bill puts it at 164,610 hectares

Myth: Mining constrained by forest rules

Fact: Forest clearance 4 times higher in this decade than earlier.
1980-97 Mine leases granted in 317 forest areas Avg. leases granted/ year Forests diverted (ha.) Avg. forest diversion/ year (ha.) 19 34,527 2,031 1997-05 881 126 60,427 8,639 1980-2005 1198 80 95,003 3,800

Impact on forest: Far higher than lease areas

Manendragarh Sarguja and Korba Lease area: 13% 18-24% converted to barren land 12-44% into degraded forest

Minerals and water: Close bond

Huge impact on water resources - both surface and groundwater Destroys small streams and rivers Groundwater is depleted as water table breached - 40% limestone mines; Rivers polluted Damodar, Bhadra, Shankhini, Brahmani

Minerals and water: Close bond

An example: sediment loading in Bhadra river increased from 1197 tonne in 1984 to 49429 tonnes in 1986

Minerals and water: Close bond

Mining consumes large quantity of water For example, Lanjigarh mines of Vedanta proposes to consume around 33,000 tonnes of water per year Taking average per capita consumption of 55 lts/day, this much water can meet requirement of 6 lakh people. During entire life of the mine (of 25 years), the mine will consume water which could have met the requirement of 15 million people

Minerals and water: Close bond

Can destroy the water basin of a river by changing course of river or destroying streams Rani Jharna and Khadi Jharna completely dried up due to bauxite mining by BALCO in Gandhamardham hills Course of few hilly rivers including Phaskhowa changed due to dolomite quarrying in Jalpaiguri The Pipawar coal mining project has cut 3 major and 25 minor streams feeding river Damodar Vedantas proposed mining in Niyamgiri hills will affect 36 streams flowing out of the range

Environmental Impacts - Air

Mainly in form of FUGITIVE DUST. Most operations generate dust - drilling, blasting, hauling, loading, transporting, storage and crushing For example, a coal stack of 50,000 tonnes can generate 250 tonne of fugitive dust even if assuming loss of only 0.5 per cent as fugitive dust. = 50,000 x 0.5/100 = 250 tonnes Opencast mining have more severe air pollution problem compared to underground mining

Environment degradation & pollution

Environmental management in Indian mines: poor Ambient air quality in many mining hubs extremely poor in some coal fields -

430 microgram/m3
Mineral transportation - major source of air pollution - KeonjharJoda-Koera/ Bellary

Environmental Impacts - Air

Fugitive dust from blasting

Environmental Impacts - Air

Fugitive dust from drilling

Environmental Impacts - Air

Fugitive dust from movement of vehicle within lease area

Environmental Impacts Transportation

Nuisance to public due to increased transportation

Environmental Impact - Waste

Solid waste generation Overburden Organic material and soil that overlie a mineral deposit Interburden Layers of shale, interstital clay and dolomite which exist with the minerals Top soil

Environmental Impact - Waste

Solid waste Overburden generation is denoted by stripping ratio. What is stripping ratio? The ratio of overburden that needs to be removed to the amount of ore removed. Example: A stripping ratio of 4:1 means that 4 tons of overburden are removed to extract one ton of ore. Low stripping ratio translates into low quantities of waste

Environmental Impact - Waste

Overburden management a major issue it takes up land and generates dust and run-off. Can even cause landslides in hilly areas In 2005-06: 1.6 billion tonnes of waste and overburden from coal, iron ore, limestone & bauxite

Environmental Impacts - Waste

Topsoil Mining operation results in excavation of large quantities of top soil It is precious as it holds nutrients and is essential for successful rehabilitation and afforestation Top soil management and its reuse is important. Poor storage can lead to run-off Amount of top soil from a mining project can be calculated. All one needs is:
Thickness of top soil and mine lease area

Example, thickness of top soil is 0.5 m and the area to be mined is 50 Ha. The quantity of top soil will be = 50 ha x 10000 m2 x 0.5 m = 250,000 m3

Fact - Waste
A weak area. Topsoil mostly dumped with overburden with no reuse.

Environmental Impacts Noise & Vibration

Noise
A cumulative effect of all mining activities produces considerable noise in the mining and adjoining area Some sources of noise blasting, drilling, crushing and movement of vehicles

Environmental Impact Noise & Vibration

Vibrations
Blasting results in vibrations and if there are human habitation nearby, it can destroy property and houses

Environmental Impacts Climate change

Climate change - Methane Specific to coal mines as it emits methane during extraction and distribution Methane is important because of:
Safety hazards Climate change

Lower quality coals ("brown" coal or lignite) have lower methane content than higher quality coals (bituminous and anthracite coal) Surface mined coal releases on average, produces only 10% as much methane per unit mined as does coal removed from underground mines

Impacts Occupational health & Safety

The workers in mine have high risk of the following occupational diseases:
Pneumoconiosis: Caused due to inhalation of coal dust. Can cause severe lung problems and lung cancer Silicosis: Due to inhalation of free silica. Prolonged inhalation causes chest pain, continuous coughing and difficulty in breathing Asbestosis: Due to inhalation of asbestos. This causes chest congestions and organ malfunctions.

Other risk include exposure to radio active elements in uranium mining. Can increase the risks of lung and bone cancer.

Impacts - Safety
Other safety hazards in mining operation include:
Explosion in mines (due to methane) Accidents due to blasting and drilling Inundation or drowning due to flooding Poisoning due to carbon monoxide (CO is generated during mine fires or explosions)

Impacts - Fire
Mine fires an issue for not only the workers but also the people living in adjoining area Jharia coal mines: In 1972, there were reportedly, 70 active fires over an area of 17 sq.kms. Presently 9 sq. km is still affected by fire even after spending Rs 115 crores. Raniganj coal mines: Out of 850 hectare land in Raniganj town, 90 hectares affected by fire and subsidence.

Mining and people

No local development, only cost. Mineral district suffer from resource curse Of the 50 top mineral producing districts of India, 60 per cent fall under the 150 most backwards districts.

Mining and poverty

Mining areas are also the poorest areas Three states with substantial dependence on minerals (between 8-10% of GDP/about 6-13% of the total revenue receipt) Jharkhand, Orissa and Chhattisgarh Characterised by low per capita income, lower growth rates and higher levels of poverty and food insecurity. Maximum number of backward districts in the country: Jharkhand (19/22), Orissa (27/30), Chhattisgarh (15/16)

Mining and poverty

Major mining districts of the country are also the poorest and most underdeveloped districts. Iron ore districts Keonjhar: Produces 21% of Indias iron ore; 60% BPL; ranked 24th out of the 30 districts of Orissa in HDI Bellary: 19% of iron ore production (most exported); largest number of private aircrafts; ranked third from the bottom in HDI in Karnataka; 50% literacy level

Mining and poverty

Limestone districts 10 districts that produced more than 5 MT all ranked at the bottom half of their respective states in HDI Gulbarga largest producing district 2nd from the bottom in HDI in Karnataka Bauxite districts Koraput produces around 40 percent of Indias Bauxite; ranked 27th out of the 30 districts of Orissa in HDI.

Mining and poverty

Chromite districts Jajpur produces 95% of Indias chromite is ranked 22nd out of the 30 districts of Orissa in HDI. Lead/ Zinc districts Bhilwara produces 83 per cent of Indias zinc; ranked 25th out of the 32 districts of Rajasthan in HDI.

Why poor?
The wealth of mining doesnt go back to the mining areas Mining takes minerals, degrades land, water and forests, does not provide local employment Mining displaces people from the existing livelihood but cannot replace it

Mining and displacement

No complete data on displacement Estimates: During 1950-1991, 2.55 million people displaced 12 per cent of all projects 2nd largest 55 per cent from Scheduled Tribes highest of all projects Only 24.7 per cent resettled (no estimations on rehabilitation) lowest of all projects

Mining and displacement

Population Density (persons/sq. km)
Western Australia: 0.79 Canada: 3.3 Brazil: 20.5 PNG: 13 Chile: 22 China: 137 India: 329 (less than 0.3 ha per person)

Any large-scale land use change will lead to large-scale displacement.

Mining and displacement

Post 1991 no data Between 2002-2006, 90,000 ha land (including forests) have been leased for mining. People displaced 50 years back are still awaiting compensation In cases people displaced multiple times

Fact - Social Impacts

There is growing protests against mining projects
10 years protest by Nimalapedu against Aditya Bilra Groups calcite mines in Andhra Pradesh Protest against Uranium mine in Jadugoda in Jharkhand Protest by Kashipur village in Raygada district against Utkal Aluminium Protest against bauxite mining in Niyamgiri hills by Vedanta (Sterlite Industries), Orissa

Mining and Naxalism

Minerals and Naxalism goes together? 40% of top 50 mineral rich districts affected Targeting mining establishments

Fact Social Impacts

Increasing conflict is inevitable.if peoples concern are not addressed