AIR bullish on striking gold reserves in India

DH News Service BANGALORE, 25 July 2003 :

Australia India Resources (AIR) foreign private company undertaking gold and base metal exploration activities in India is bullish on discovering gold reserves in the country. It plans to invest Rs 30 crore toward these in next three years.

Talking to Deccan Herald, AIR Managing Director Sandeep Lakhwara said they are in advanced stages of discovering gold reserves at four places in Karnataka and Andhra Pradesh. These are North and South Hutti, Mangalore in Karnataka and Ramagiri in Andhra Pradesh. AIR so far has invested Rs 10 crore in exploration activities.

Mr Lakhwara said India has very long history of gold reserves but gold exploration companies in India lacked necessary technical expertise and financial resources to undertake “risky activities”.

The reason for AIR for undertaking exploration activity in India was similarity in terrain in Western Australia and India. Australia produces around 600 tonnes of gold annually while in India it just about two tonnes. However, he said any discovery of gold deposits and subsequent mining will depend on economic viability of resources available.

AIR constituted in Perth, Australia in 1993, has received 26 reconnaissance permits for exploration of base metals in India which includes zinc and nickel other than gold. It is simultaneously undertaking prospecting activities in 8 to 9 states in India.

AIR also listed first gold exploration company in India by acquiring majority stake in Wimper Trading Limited and renaming it as Deccan Gold Mines Limited (DGML) in January 2003.

DGML gives opportunity for Indian investors to participate in mining activities in the country. To enhance valuation of DGML, AIR through its subsidiary companies will transfer the advanced exploration prospects to DGML. The four advanced gold prospects areas will transferred to DGML and are pending approvals from respective State governments, he said.

They will soon come out with rights issue to Rs 5 crore for DGML, he said, adding they have applied for splitting of shares. The company would also look at raising funds from abroad in countries like UK, Canada and Australia.