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Sunday, December 9, 2012

ZERO BALANCE CURRENT ACCOUNT


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Iron and Charcoaling Industries


The Historic Iron and Charcoaling Industries
The beginning of the iron industry in America goes back over 100 years before the Revolution.  Pig Iron for the revolutionary War, the War of 1812, the Mexican War, and the Civil War was obtained in large quantities from the Virginia pig iron industry.

It might be said that American iron making began in England.  In 1609, iron ore mined by Jamestown colonists was shipped to England where it produced superior metal.  Following this successful venture, the first American iron works was erected about 1620 on Falling Creek about 7 miles south of Richmond.  However, in the Indian raid of 1622 these first American furnaces were destroyed even before being put into operation. 

The first successful iron making industry in the south did not develop until over a century later when Governor Spotswood established furnaces in Spotsylvania Country near the Rappahannock River.  The Rappahannock furnace was placed in operation in 1714.  For the next 50 years, growth in the iron industry was slow and although furnaces continued to be built, others failed to operate economically or were closed. 

In 1781, five operating furnaces were listed in Thomas Jefferson’s “Notes on Virginia”.  Of these, Mossy Creek and Zane Furnaces were in the Shenandoah valley, in the 1800’s there were several furnaces operating in the Shenandoah valley area Columbia, Liberty, Caroline, Boyer, and Elizabeth Furnaces to name a few. 

Having learned the iron making art during their indentured service to Governor Spotswood eighteenth century Swiss, English, and German settlers scattered across the Common wealth and carried their knowledge into the Shenandoah Valley, where there were already other workers following the valley down from Pennsylvania.  Their early furnaces were a far cry from today’s massive blast furnaces of Pennsylvania and Ohio.  Though small, there were several essentials for the location of a furnace found in the Valley – an adequate supply of iron ore and limestone, sufficient waterpower to turn a water wheel that operated a bellows for the fire, and an abundance of timber for charcoal that was the fuel for smelting the iron ore.  

Elizabeth Furnace is a typical example of these early furnaces.  A self-contained community grew up around the furnace – known colloquially as an “iron plantation” under the direction of the owner or “iron master”.  These communities (the forerunners of the company towns seen in the coal fields today) consisted of the mansion of the iron master, cottages for the labourers, tool and storage sheds shops for carpenters and blacksmiths, a store, stables, for mules and oxen, schools for employees’ children, and the furnace.  The furnace itself was a pyramid of stone, varying in size, usually about 30 feet square at the base and 25 to 40 feet high, furnaces were erected against the side of a small hill so that the charge (iron ore, limestone, and charcoal0 could be carried or wheeled from the stockpile across a bridge and dumped into the stack at the top. 

While the furnace itself required a relatively small crew to operate it there were dozens of people working in the woods felling trees, burning the charcoal, working the ore diggings, mining the limestone, and caring for the mules and oxen.

MINING IRON ORE AND QUARRYING LIMESTONE:
Before the mining could begin, the ore had to be located; therefore the first step was prospecting.  After a general geological survey was made, trenches or pits were dug.  The loose earth was removed and digging continued until the solid strata of the rock was laid open.  If the expected vein of ore was not found, the trench or pit was continued farther uphill or downhill until the mineral vein was located.  Since the early prospectors had crude tools to execute this type of prospecting.  It was best to select the steepest terrain to reduce the amount of work in removing the overburden 9the non-mineral covering of dirt and rock).  Many of these trenches and pits may still be seen today throughout the George Washington National forest.
Another method of locating ore was to sink a shaft.  A shaft was about four feet wide and 30 to 70 feet deep.  These shafts are also extant today on the National forest, appearing as depressed areas in the ground.  The costs of sinking the shafts varied from one to three dollars per foot, up to seventy feet, depending on the diameter of the shaft; over 70 feet, the cost increased considerably.

There were two methods of ore mining.  These of course were the same as prospecting – surface or strip mining and subsurface mining.  Subsurface mining was accomplished either by digging a drift (horizontal) or a shaft (vertical).  The mines had to be protected from cave-ins by the use of black locust, white oak, and red oak shoring timers ten to twelve inches in diameter.  Most of the mining was the more economical strip mining that entailed the removal of all overburden covering the ore.  Miners then excavated the ore with pick and shovel.  When the overburden became too thick to remove economically, the strip mine was abandoned and the miners moved to another location.  Wages for digging ore and quarrying limestone varied considerably, according to the location and facilities, with the price ranging from one to four dollars per ton. 

Deposits of Oriskany brown iron ores occur locally in the western portion of the Appalachian belt, from Maryland to south-western Virginia.  Minor deposits in the Shenandoah Valley occur in the Buffalo Gap area, in the Massanutten Mountains, and on North Mountain in Shenandoah and Frederick countries.  The iron content of the Oriskany ore ranges between 35% and 50%.  After mining and quarrying, the ore and limestone were hauled on wagons pulled by oxen or mules to the furnace bank where it was piled along the road for storage until needed by the furnace.  

CHARCOAL MAKING:
The third ingredient needed for iron making was a material to provide heat; charcoal when fired provided the heat to melt the ore.  The process of making charcoal was considered an art and the charcoaling skill was called the “Mystery of Charring”.  The master collier and one or two helpers “coaled” together work as many as eight or nine pits at a time.  The collier’s hut was placed in a central location to the group of pits being fired.  The hut was conical in shape, having a base about eight feet in diameter and height of about ten feet.  It was constructed of three-inch poles that were covered with leaves to form a mat so that the final dressing of topsoil would not sift through the remaining crevices.  A door just large enough for one person to get through was p0alced on the pit side of the hut and a wood stove and rough long bunks wee the furnishing of this temporary structure.

The hearth of the charcoal 9or collier’s) pit was a flat space 30 to 40 feet in diameter and free of all brush, roots, and stumps.  Much care was taken so that the surface of the hearth was hard and smooth so s to afford good shoveling and raking of the coal.  The hearth had to be level to assure uniform burning. 

A collier’s responsibilities did not begin until the wood had been sledded in from the woodchopper’s ranks to the hearth, and there set on end until the entire surface was filled.  This wood usually was cut during the winter months and allowed to season until the coaling operations began in late spring.  Colliers often became woodchoppers during the winter in order to receive a full years’ pay. 

Two sizes of wood were used by the colliers to “set up” their charcoal pits; lap wood ranged in size from one and a half to four inches in diameter, and billets varied from four to seven inches.  All wood was cut in four- foot lengths.  The woodchoppers “ranked” the cut wood separating each cord by up-right poles so that the owner, in computing the woodchopper’s wages, could count the number of cords readily. 

Woodchoppers received 40 to 50 cents per cord ranked.  An expert “ranker” could sometimes cut and put up five cords per day.  This system was to turn all bark sides down in the rank and use crooked sticks to prevent the wood from packing closely.  The average amount cut was two cords per day. 

The wood hauler brought the billets and lap-wood from the woodchopper’s ranks to the hearth on a wooden sled pulled by a mule or hose.  The road leading to the pit always went right through the hearth so that the hauler could unload easily and drive out on the other side on his way for another load.  When the hauler had filled the hearth with wood, that job was finished.  It was at this point that the collier and helpers began the building of the pit.  Actually, the word “pit” is misleading for it refers to the structure as a whole including the hearth and the pile of wood and does not convey the impression of a hole in the ground. 

The first step in building the pit was to find the centre of the hearth and erect the “Fagan” a green pole 18 feet long and three or four inches in diameter.  A three-cornered chimney was constructed around the Fagan using lap wood.  When the chimney was five feet high, the collier placed the billets carefully against it, allowing each piece to protrude slightly at the base.  When the first ring of billets had been placed, another ring was begun, the base protruding a little more each time, so the outside ring would have enough slope to the sides of the pit to enable the final covering of leaves and dust to rest securely without sliding off, lap wood was fitted whenever possible to take up the air spaces. 

After the first tier of billets and lap wood, which was called the foot, had been set out from the chimney far enough to give the collier a footing; he climbed up on it, built the chimney up another four feet or so, and then set the second tier of billets and lap wood called the waist.  This procedure was continued until the chimney was completed and a rounded structure was fashioned.  Throughout the operation great care was taken to set and fit the pieces substantially together to prevent the whole from reeling or twisting.  Lapping-off was the last job in completing the construction of the pile. This consisted of using what lap wood was left to fill in all possible air spaces and cracks on the sides before the final covering of leaves and dust was spread on. 

The Pit now “set”, the colliers constructed a ladder by notching out steps in an 8 inch log long enough to reach from the ground to the head.  Enough chips and fire kindling were cut to fill the chimney within a foot of the top and a bridge of three billets and several pieces of lap wood to cover the chimney made the pit ready for “leafing and dusting”.

Leaves were raked by the collier’s helper, from the forest floor into piles then carried to the pit in baskets.  The leaves were scattered uniformly over the pit to a depth of several inches.  The long-handled collier’s shovel was used to spread on the dust that had been raked in a ring around the circumference of the hearth during the early preparation of the site.  Several inches of dust were required for the sides and at least a foot on the head and shoulders. 

The pit was then ready for firing.  A shovelful or so of red-hot coals from the colliers cooking
Fire is placed on top of the kindling in the chimney when the bridge and covering were replaced. The lighting of the pit was usually done toward evening in order that the collier might have at least one more good night’s sleep before the constant watching began for it was not likely that the pit would “burn through” or need dressing until the following afternoon.  Any kind of wood was used to make charcoal but it must be “solid”.  It was generally held that the harder the wood, the better the coal.  It was usually the practice to cut clean, using everything except deadwood and in 30 years the tracts would be coaled again,

The collier’s enemy was fire; the “live” fire, which would consume and undo all of his painstaking efforts to achieve the “dead” or charring fie.  Flames might break through the covering and destroy the whole pit.  A gas explosion might blow off the cover.  Soft spots had to be found by the rather dangerous operation of jumping up and down on the surface.  They had to be reinforced or dug out and replaced with new wood, leaves, and dust to preserve the original shape of the structure.  The pit was tended in this manner every evening in order to prevent, if possible, its burning through during the night.  The number of days required for a pit to burn off varied greatly with the size of the hearth and the kind of wood.  For the average hearth, this held 30 cords or so of partly seasoned wood.  It took from ten days to two weeks for the pit to come to foot, that is for all billets to char. 

Because charcoal carries fire for a long time only small amount could be removed at a time making the ranking at a tedious and painstaking task .The collier chose a side of the pit where the dust was driest and with a shovel dug out a portion starting at the foot. This opening acted as a draft and soon there were signs of fire .At that point the collier stooped digging and covered the burning area with dry dust to reseal the pit and allow it cool. The long iron-toothed collier’s rake was then used to draw back into the ring the pile of charcoal which had just been dug out and each pile was kept in a separate ring so that a single fire might not destroy the total.

On the day when the wagon was to come for the first load, the colliers were up early and ready to start work at dawn. They spent several hours in raking out the coal and the rest of the morning in seeing that no fire remained in it. The same collier’s baskets that were used to carry leaves to the head of the pit were used to fill the wagon with charcoal. Charcoal wagons held about 200 bushels of charcoal. They were drawn by six mule teams and equipped with high sideboards and a button that would pull out. Upon reaching the charcoal house, the teamster unhooked the lead team from the “spreaders “and fastened their whiffletree to a coupling connected to the sliding floor of the wagon. In that way the load of charcoal was dumped without effort to the teamster or damage to the brittle charcoal.

Charcoal made an ideal fuel, being almost free of sulphur, and its ash, consisting largely of lime and alkalis, supplied part of the necessary flux. Hickory was the best wood for making charcoal but all trees were used. The wood was not charred immediately after being cut but only a short time before it was needed. Large as most of the strong-walled charcoal houses were, they could not hold enough fuel to feed the furnace for any length of time and to have left the charcoal outside would have made it unfit for use. An average furnace would consume from 600-800 bushels of charcoal every 24 hours. This required about 30-40 cords of wood from trees 25 – 30 years old.  Some furnaces consumed the yield of an acre of woodland each day.

Perhaps the one disadvantage of charcoal as a fuel was its lightness that made it easy to crush.  This was the factor that limited the height of early furnaces in the Shenandoah Valley to a maximum of about 35 feet.

The clear cutting of the forest went on year round to provide enough wood for the charring season.  As many as ten or twelve colliers were needed to keep a furnace going.  Three cords of wood made enough charcoal to fire the furnace for about two hours and produce one cubic foot of iron; therefore it took about 8 cords of wood to produce one ton of pig iron.  Once the furnace started it ran 24 hours a day during the summer months.  If you assume that this season was from May 1 to September 1, then the furnaces operated 123 days.  This means that the furnace ran for 2952 hours and consumed 3 cords of wood (in the form of charcoal) every two hours.  This meant that each year 4,428 cords of wood was cut off provide the charcoal. This is the approximate yield of about 150 acres of woodlands each year, in the middle 1800’s there were five furnaces operating in the Massanutten area of the Shenandoah Valley alone meaning 750 acres of land was clear-cut to provide charcoal for the furnace and that it would be between 25-30 years before that area could be coaled again.  In this amount of time between 19,000 and 23,000 acres of forest had been clear-cut in continuous bands.  These operations caused impressive impacts on the forests of the Shenandoah Valley that may still be seen to this day as the mountains were criss-crossed with roads, dotted with collier’s pits, covered with iron ore test pits, and scarred by mining operations.

Three main raw materials were needed for the successful operation of charcoal ironworks: water, iron ore and timber.  All of the Shenandoah Valley’s forges and furnaces were located on or near water sources.  The bellows connected to a water wheel.  As water turned the wheel, the bellows alternately injected blasts of air into the furnace that helped to create and maintain the high temperatures needed for the furnace and forge to work.

The relatively primitive transportation techniques in the 19th century made it necessary to locate furnaces within a convenient distance from the ore beds.  In the Shenandoah Valley a brown hematite ore was the main supply used. 

HATTI GOLD MINE


Hatti Gold Mine
The history of mineral development is as old as the civilization. In India, the mineral production dates back to the ancient times as the mining activities can be traced as far back as 6,000 years or so. The remains of some of the old mine workings are witness to this fact.

A few of these workings have led to the discovery of a number of significant mineral deposits, which are being worked in the present time. In recent times the impetus to the mineral development was imparted in the country only after the political Independence came in the year 1947 when the significance of role of minerals was realized in nation building. Realizing the significance of industrial development of the country, Industrial Policy Resolution was promulgated in 1956 by the Central Government. Under this ambitious programme of developing several industries (such as steel, non-ferrous metals, cement, power, fertilizers, etc.) were launched which required increasing quantities of minerals. Coal was the one to have received the maximum attention for being the basic fuel for a whole range of industries such as steel, railways and power plants.

The entire production of lignite, petroleum and natural gas, copper, lead- zinc ores, gold, silver, diamond, tungsten concentrates, pyrites, rock phosphate, etc. was contributed from the mines operated under the public sector.

Current Status
Being aware of the vast potential of the sector, the Indian Government has been consistently and in a pragmatic manner opening up the previously controlled regime to usher private investment in the sector and infuse funds, technology and managerial expertise. The opening up of the Indian mining sector has, therefore, generated considerable global interest. The Indian mining sector was opened up to Foreign Direct Investment in 1993 after the announcement of the New Mineral Policy. In India, 80 per cent of mining is in coal and the balance 20 per cent is in various metals and other raw materials such as gold, copper, iron, lead, bauxite, zinc and uranium.

COMPANY PROFILE
BACKGROUND AND INCEPTION OF HUTTI GOLD MINES
1887
Gold Mine was undertaken by ‘Hyderabad (Deccan) Company” for the Nizam of Hyderabad.
1880 -1920
Modern mining took place by M/s. John Taylor's and Sons. During the period between 1902 to 1918 only the Main Reef alone produced 3.8 lakhs tonnes of ore and yielded 7.41 tonnes of gold @ an average grade of 19.45 g/t. and was mined up to 1052 m. depth.
1920
Mine was closed down due to paucity of materials and funds at attributable to world war 1.
1938
Detailed exploration by geological & Geophysical surveys diamond drilling and dewatering of the village reef mine were conducted which resulted in rediscovery of Village Zone-I and Okleye’s Reefs.
1947
On 8th July 1947 “ The Hyderabad Gold Mines Company Limited” was incorporated and the mining operations were entrusted to  John Taylor & Sons by the Nizam Hyderabad.
1956
It was renamed as “The Hutti Gold Mines Company Limited” (H.G.M.L) with the formation of Mysore State (now Karnataka) when the state reorganized.
1966
Indian Gold Control Act 1966 imposed severe restrictions on Gold trade and industry.
1971
  In its Silver Jubilee year the capacity was tripled from 310 TPD to 910 TPD.
1985
Two loss making Copper units “Chitradurga Copper Company and “Karnataka Copper Consortium Limited “at Kalyadi were amalgamated with H.G.M.L. Thus the company’s operations were extended to copper mining and produced of copper concentrate.
1992
The Gold Control Act was replaced allowing free import of gold resulting in almost stabilization of Indian gold prices.
1996
The Gold Control Act was replaced allowing free import of Gold resulting in equalization of Indian Gold prices with International Gold prices.
Introduction of Carbon-in-pulp (CIP) technology in the Mill Department.


1997
In its “Golden Jubilee Year”, H.G.M.L. undertakes a comprehensive Modernized & Expansion Programme to double its production by increasing capacity at Hutti and conversion of Copper units to Gold units at Chitradurga and Kalyadi.
1998-99 & 2002
Phase wise Ball Mill addition.
2004
Introduction of large Agitators (11m dia x 11.5 m height). And the total Gold production was 3499.227 Kgs. which was the highest record production in the history of the HGML.
2005
Improvement in the Sand Stowing system, Detoxification plant, new high rate thickener and Carbon column.
2008
The total Gold production was 2796 Kgs. of gold was produced in the year 2007-08.
2010
Sag & Ball Mill.

Hutti Gold Mines Company Limited (HGML), Government of Karnataka Undertaking (Established in 1947 as Hyderabad Gold Mines), has the unique distinction of being the only producer of primary gold in the country.

HGML has been active in the exploration, development and exploitation of gold deposits occurring in Karnataka.

The Company’s Corporate office is situated in Bangalore and it operates two units and two satellite mines. The Hutti Gold unit (HGU)  and satellite mines at UTI (Opencast) of Deodurga taluk and Heera Buddinni (Exploratory Underground mine) of Manvi taluk-in Raichur district and the Chitradurga Gold unit (CGU) in Chitradurga district.

HGU with capacities to produce 600000 TPA currently processes the ore from Hutti Mine and two satellite mines at Uti (opencast) and Hira-Buddinni (Exploratory underground mine).  The gold operations at CGU are temparorily suspended, and the Company has installed wind farm with capacity of 9.3MW power generation in its area.

Geology & Reserves
Hutti is located at Latitude 16o 12’ N. Longitude 76 o 43’ E.
The Hutti Gold Deposit is located in the Hutti-Maski Pre-Cambrian greenstone belt. The auriferous lodes occur within the metaba salts and are gold quartz sulphide lodes, which are confined to laterally and depth persistent shear zones.

Gold occurs in native state and is generally associated with quartz veins and also with sulphide minerals viz., arsnopyrite, purrhotite and pyrite as inclusion, fracture filling and also replacement in microscopic and submicroscopic particles. Localization of gold mineralization is litho logically and mainly structurally controlled and the ore shoots have typical geometric pattern of distribution. There are nine parallel lodes exposed on the surface, of which six lodes are being mined. The Hutti deposit extends for about 4 km strike length and the width covered by all the parallel lodes is about 1.5 km. The parallel lodes have a general strike of NNW – SSE and dips ranging from 600-700 due West.

The strike length covered by the present mining is 1.4 km and the proved and probable ore reserves up to the present mine depth of 846 m are 6.76 million tonnes at 5.27 g/t grade. The immediate northern and southern extensions of Hutti mines also have good potential and detailed exploration by drilling and exploratory mines development is in progress on the extensions of New East Reef, Strike Reef, Zone-I Reef, Middle Reef and Oakley’s Reefs. 


Nature of the Business carried out
Ø    To carry out exploration activities to increase the ore reserves of the mining area and find new deposits
Ø    To beneficiate, smelt, refine, cast of finished gold metal in to saleable products in the form of bullion buttons
Ø    To increase the efficiency of the mine and production plants with the cost reduction, by producing 2000 tons per day & by implementing modernization/expansion project
Ø    To improve profitability to achieve financial stability
Ø    To build a top class Gold Mine for next 50 years


VISION AND MISSION:
Vision
ü    The Corporate Vision is to become one of the most vibrant, self reliant, financially viable Corporate.
ü    Improve Productivity and Profitability.
ü    Provide Steady Growth in terms of percentage of capacity utilization.
ü    Provide safe working condition and strong focus on safety.
ü    Give more importance to the Mined development and safety of workers and endeavour to adopt world class safety standards.
ü    To reach the set targets and goals by adopting process improvement.
ü    To undertake welfare and community development in Hutti.

Mission
ü    To develop HGML industry on sound lines by exploiting existing gold deposits and developing new gold mines located in various parts of Karnataka.
ü    Adoption of appropriate cost effective measures
ü    Bringing modern mining technology and expertise
ü    Adopt modernization and expansion programs at Hutti in order to make the company a self reliant, financially viable venture.
ü    Have environment friendly and healthy mining and production process

PRODUCT PROFILE:
Gold has long considered one of the most precious metals, and its value has been used as the standard for many currencies (Known as the gold standard) in history. Gold has been used as a symbol for purity, value, royalty, and particularly roles that combine these properties.

The price of gold is determined on the open market, but a procedure known as the Gold Fixing in London, originating in 1919, provides a twice-daily benchmark figure to the industry.

Historically gold was used to back currency in an economic system known as the gold standard in which one unit of currency was equivalent to a certain amount of gold. As part of this system, governments attempted to control the price of gold by setting values at which they would exchange it for currency.

For all long period the HGML, Government of Karnataka Undertaking (Established in 1947 as Hyderabad Gold Mines), has the unique distinction of being the only producer of primary gold in the country.

HGML has been active in the exploration, development and exploitation of gold deposits occurring in Karnataka.

Gold Bullion buttons/bars Produced By Hutti Gold Mines
                                                                                       
GML’s Production Performance of the Decade (2000-2010) 
Year
Ore hoisted Hutti only    (in tons)
Ore treated (Hutti + NP) (in tons)
Gold produce (in kg’s)
1999-00
254529
349084
1395.82
2000-01
260199
335845
1784.99
2001-02
379251
409437
2333.50
2002-03
460637
525928
2640.496
2003-04
483263
623125
3096.544
2004-05
480826
592685
3507.607
2005-06
454351
513722
2848.340
2006-07
484723
522374
2336.36
2007-08
504654
570447
2420.232
2008-09
504654
570447
2420.232
2009-10
498099
555200
2069.750

Area of operations:
The area of operation covers Karnataka state. It can be said as regional operation. The Hutti gold mines ltd is only one unit producing gold. It has got other units like HIRABUDDINI & UTI. The company can produce around 7 kilograms of gold every day and will send to Bangalore regional office to sell in Bombay Bullion market Chitradurga  Windmill Project.

Ownership pattern:      
Government has owned 99%of the company shares and rest is owned by the private enterprises.

Competitors’ information:
There are no competitors because of the nature of the product that is gold and Hutti gold mine is one and only gold mines in India.

Infrastructural facilities:
Housing :-
The company has having 2365 quarters. These have been allotted to eligible officers, Staff and Employees. Regular visit made to colonies by Welfare officers to regulate Health and Hygienic Camp area.

Hospital :-
HGML Company has also most modern Hospital facility with 120 wide capacity. The existing hospital is equipped with modern infractures like AC operation theatre, ECG, X-ray, Ultrasound scanner, Defibrillator with cardiac monitor, Auto analyzer, Lung function test in computer, Blood bank, Ventilator etc.