Commodity Online BANGALORE:
Who will benefit from the soaring gold prices, which last week hit Rs 14,000 per 10 gm? There may be unusual beneficiaries if the gold prices keep rising like the past few months.
Gold price witnessed big leap during the past few months following the fall of global markets and investors rushing for the yellow metal in hordes.
This rise of gold prices has forced the Center to do a rethink on the fate of Kolar Gold Fields (KGF), one of world’s oldest and deepest gold mines in Karanataka which was closed down in 2000 as operations here became financially unviable.
When the mines were closed down, gold prices were around Rs 6,000 per 10 gm. Things have changed during the past seven years. Gold saw a dramatic rise and people started showing interest in KGF, situated around 70 km from Bangalore.
The Bharat Gold Mines Ltd (BGML) was founded by Briton John Taylor and Sons. When the mines were closed down, the Centre had pointed out that the cost of producing gold was more than the output. The gold yield per year also did not cross a hundred kilos.
The mine is situated in a beautiful landscape and the equipment and other facilities are still lying at KGF. The area has a rock science lab, a National Institute for Miners’ Health and a golf course set up in 1880.
The KGF had nearly 4,000 workers until 2000. In a step that has given the signal for revival by the Centre is that it appointed B L Bagra, finance director of National Aluminium Company (Nalco), as managing director of BGML.
Bagra is a veteran in mining and is hopeful of turning around BGML with technology and skilled personnel. Bagra will give a detailed presentation to Karnataka chief minister B S Yeddyurappa soon.
Another incentive for the KGF fields to glow again is a directive from Karnataka High Court to the government to consider the factory’s revival.
Experts feel that almost fifteen tonnes of pure gold could be extracted from the roughly forty million tonnes of tailings.
Several governments over the years showed a step-motherly attitude to the development of KGF that otherwise could have been built on its past glorious reputation.