NEW DELHI (Reuters) – Indian resources conglomerates Adani and Vedanta are considering bidding for a $9 billion(£6.83 billion) diamond project in the country that was abandoned by global miner Rio Tinto (RIO.AX) (RIO.L) this year, according to multiple sources with knowledge of the matter.
The central state of Madhya Pradesh was likely to invite bids in the first week of November to explore the deposit, which is estimated to hold around 32 million carats of diamonds, a senior state government official said.
“We’re advertising only for that area in which (Rio Tinto) have prospected and established availability of diamonds,” Manohar Lal Dubey, Madhya Pradesh’s top mineral resources official, told Reuters by phone. An auction would be held around 40 days after the notice inviting bids was published, he said.
Rio Tinto “gifted” the Bunder deposit, about 500 km (300 miles) southeast of New Delhi and discovered by the company in 2004, to Madhya Pradesh in February after saying last year that it was pulling out to conserve cash and cut costs.
The company spent around $90 million over 14 years on Bunder, located in a forested area important to tiger and wildlife habitats, with the plan to invest up to $500 million. The project had been hampered by delays in obtaining environmental permissions.