Rana Som in Calcutta on Tuesday. Picture by Kishor Roy Chowdhury

Calcutta, June 1: An ex-employees’ cooperative is set to take over a closed copper mine belonging to Hindustan Copper Ltd (HCL) in Ghatshila — an unprecedented move in the domestic mining history.

The Surda copper mine is closed for the last four years and the management took an initiative to reopen the mines through the employees’ cooperative.

Chairman Rana Som said the company has decided not to renew the mining lease which will expire shortly. Instead, HCL has urged the Jharkhand government to transfer the mining lease in favour of the Mosaboni Ex-employees Self Supporting Labour Co-operative Society.

Union coal and mines minister Shibu Soren has already approved the proposal and offered all cooperation to MESSL.

“This is going to be a win-win situation for both HCL and the cooperative which will provide jobs to about 600 ex-employees who took voluntary retirement. If the experiment goes well, I am hopeful that other companies might try out the same route to reduce cost,” Som said.

Once the mine is operational, it will cater to 20 per cent of the overall copper concentrate needs of the company’s smelter in Ghatshila which is being reopened on June 15, he said.

Sourcing copper concentrate from Surda will save the company about Rs 6,400 per tonne in terms of freight.

HCL has offered its immovable assets worth Rs 1 crore to the cooperative at a token rent of Re 1 per annum. Movable assets worth Rs 35 lakh, comprising mostly mining equipment, will be given at book value. The price will be realised against the supply of copper concentrate by the cooperative.

The Ghatshila smelter, which was closed down in May 2003, used to bring copper concentrate from Malanjkhand where the company has an open-cast mine.

Apart from Surda, HCL had three mines in Ghatshila on lease which had already been returned to the state government.

Som said it did not seem viable for the company to operate the three underground mines here because of heavy overhead costs as well as high developmental expenditure.

Som, however, said mining remains the focus area of the company as no other copper company in the country has captive mines. The company is set to invest around Rs 48 crore over two years for the development of its mines, particularly in Malanjkhand and Khetri. Another Rs 16 crore will be invested to modernise its smelter at Khetri.

The company, which turned around in the last quarter of the last fiscal after a gap of seven years, has projected a total output of 35.5 million tonnes against 28.5 million tonnes in the year ended March 31, 2004.