Bolan Mining Enterprises

Bolan Mining Enterprises

Bolan Mining Enterprises (BME) is a joint venture between the Government of Balochistan (GoB) and Pakistan Petroleum Limited (PPL), each sharing a 50 percent working interest. BME was formed through a joint venture agreement signed on June 1, 1974 between the two for 30 years to mine, grind and market baryte deposits in Gunga near Khuzdar and other minerals in Balochistan. PPL was designated as operator under this agreement which was renewed in June 2004 for another three decades.

A barytes mining lease spanning 316 acres for exploration of barytes in Gunga near Khuzdar, originally hosting proven reserves of 1.28 million tonnes, was granted to BME by GoB in 1974. The lease is valid up to 2033. With recent drilling in the area, indicated reserves of over 40 million tonnes have been established.

BME operates two grinding mills for barytes with the total production capacity to 70, 000 - 80,000 metric tonnes barytes annually in line with the specifications of the American Petroleum Institute. In view of the increasing local and export demand, BME has recently completed installation and commissioning of a third grinding mill which will increase the grinding capacity to 135,000 – 150,000 metric tonnes.

Over the years, BME has met nearly 90 percent of the barytes requirement of the oil and gas exploration industry in Pakistan. Besides PPL, the major customers of barytes are Oil and Gas Development Company Limited, Pakistan Oil Fields Limited, Mari Petroleum Company Limited, Scomi Oil tools (formerly known as KMC Oil tools), M-I SWACO (Pakistan) and Baker Hughes Incorporated. BME also exports barytes powder and lumps/ ore to the international market, mainly covering Gulf Cooperation Council countries and saving foriegn exchange for the country. 

In 2002, GoB also granted a mining lease over an area of 13,660 acres in Dilband for iron ore exploration to BME. Fine iron ore from Dilband was supplied to Pakistan Steel Mills during 2003 and 2004 under a sale/purchase agreement. However, the supply was discontinued due to low contents of iron (TFe) and high percentage of silica & alumina in the ore. BME carried out a research project for upgradation of Dilband Iron Ore on Lab scale. The upgraded ore test results, however, showed no significant improvement. Future course of action and alternate usage of Dilband ore is also being explored. 

BME also holds two mining licenses, valid until March 2027 in the northwest of Nokkundi for mining of iron ore. However, ,mining activities were held up due to prolonged litigation on mining Lease. Following the Balochistan High Court's decision in favour of BME at ML(5) in October, 2018, early mining activities were initiated for iron ore through a local firm/ contractor. First commercial sales of iron ore lumps have been initiated since June, 2020. 

Moreover, BME has also initiated phased-wise exploration activities for identifying new iron ore prospects in the litigation free area in ML (4). In Phase-I, 640 meters exploratory drilling was done during 2017-2018. In Phase-II, further geophysical investigations and exploratory drilling of 2000 meters are planned during 2020-2021.

An exploration license for lead and zinc, covering an area of 93,507.63 acres, west of Khuzdar was granted to BME in March 2008. A contract was awarded to renowned consultant DMT consulting GmbH, Germany to prepare a bankable feasibility report for exploration of Baryte-Lead-zinc deposit. Under the supervision of DMT (project consultant), initially 2,100 meters of exploratory diamond core drilling was carried out which established the presence of lead & zinc as well as baryte in the leased area. To this end, about 1,018 drill core samples were prepared and analyzed chemically for ascertaining the ores' quality. Based on the positive findings, DMT further recommended for approximately 10,000 meters (±10%) resource drilling at 27 different locations for 'Resource Evaluation’ Joint Ore Resource Committee's review. Subsequently, a contract was awarded to Interdrill Pty Limited, Australia for drilling. Drilling data has been compiled and approximate 3,000 drill core samples have been analyzed chemically for ascertaining the ores' quality.

Based on the evaluation, a feasibility report has been submitted by DMT, establishing the economic viability of the deposit. Currently, plans are underway to initiate tendering for installation of processing facilities and mine development as per best industry norms. Commercial production is expected to commence in 2022 -2023

Discovery

 Barytes: 1967; Iron ore (Nokkundi): 1970; Iron ore (Dilband): 1997; Lead & Zinc west of Khuzdar: 1967

Indicated Reserves*

Barytes: 40.4 million tonnes; Iron ore (Nokkundi): 45 million tonnes; Iron ore (Dilband): 167 million tonnes; Lead & Zinc: 80 million tonnes

PPL Working Interest

 50 percent

Daily Average Production**

 Barytes: Mining:  270 tonnes

              Grinding: 55 tonnes

 Iron Ore: Mining: 50 – 80 tonnes

*Indicated resource is the resource for evaluating economic mineral tonnage, grade and mineral content that can be estimated with a resonable level of confidence

**Daily production figures are averaged for 6 months from July 2020 to December 2020