Shree Samarth Minerals - Technical Study Report - R0 PDF

Technical Study Report
for
Chimakurthy Black Galaxy Granite Mine Project

(Latitude – 15.588376, Longitude – 79.810800)
to
M/s Shree Samarth Minerals
Report Date – February 26, 2019

Tanka Engineers LLP
rd
No 142, 1st Floor, 3 Cross, Hari Nagar, JP Nagar
8th Phase, Bengaluru - 62
www.tankaengineers.in
Technical Study Report 2019
Table of Contents
Introduction ....................................................................................................................................................................... 3
Property Description ..................................................................................................................................................... 3
Geology.................................................................................................................................................................................. 6
Resource / Reserve Estimate .................................................................................................................................... 7
Quarrying Operation ...................................................................................................................................................... 9
Machinery requirement ....................................................................................................................................... 10
Manpower requirement ...................................................................................................................................... 12
Market Information ..................................................................................................................................................... 12
Financial Analysis ......................................................................................................................................................... 14
Six Month operation .............................................................................................................................................. 14
Overall Project Assessment ................................................................................................................................ 16
Conclusions and Recommendation ..................................................................................................................... 17
Annexures......................................................................................................................................................................... 18
Page 1 of 18
List of Tables
Table 2-1 Sy.No 106 - Sub Division................................................................................................................................... 5
Table 4-1 Resource / Reserve Estimate ......................................................................................................................... 7
Table 5-1 Machinery requirement for quarrying................................................................................................... 10
Table 5-2 Machinery requirement for 6 month operation ............................................................................... 11
Table 5-3 Manpower requirement for quarrying .................................................................................................. 12
Table 6-1 black Granite - Grades..................................................................................................................................... 14
Table 7-1 Cash flow projection for first 8 month ................................................................................................... 15
Table 7-2 Cash flow projection for the Project ........................................................................................................ 16
List of Figures
Figure 2-1 Google Earth Image of the property ......................................................................................................... 4
Figure 2-2 FMB Sketch of Sy.No 106 ................................................................................................................................ 5
Figure 3-1 Geological map of Eastern Ghats Belt (EGB) ........................................................................................ 6
Figure 4-1 Operating Mine near Sy.No 106 .................................................................................................................. 7
Figure 4-2 Phase 1 - Mineable Resource........................................................................................................................ 8
Figure 4-3 Phase 2 - Mineable Resource........................................................................................................................ 8
Figure 5-1 Sketch showing Bench Face .......................................................................................................................... 9
Figure 5-2 Diamond wire saw cutting............................................................................................................................. 9
Figure 6-1 Black Galaxy Granite with gold specks................................................................................................. 12
Figure 6-2 Photo of Cut granite block at site ............................................................................................................ 13
Page 2 of 18
Introduction
Tanka Engineers LLP is a company formed in 2017 aimed at providing ONE STOP solutions
to clients covering high quality engineering, procurement and construction services to
Mining, Material Handling and Process Industries. The team has experience & expertise in
project management, detailed multidiscipline engineering, procurement, logistics
management, and construction services to the mining, mineral processing, infrastructure and
materials handling Industries. The company has tie up with professionals within India and
overseas with a vision of bringing the expertise together as a single package for the end
clients.
Tanka Engineers was contacted by M/s Shree Samarth Minerals for study of Granite Mine
Project at Chimakurthy with an objective of,
1. Evaluating the Project and its feasibility
2. Tentative resource / reserves
3. Tentative manpower and equipment requirement
4. Financial assessment of the project
5. Plan for first 6 month of production
Following are the team from Tanka who carried out the technical study.
• Mr. K.B. Ramachandra - Mining Engineer by Qualification with over 38 years of

broad experience in Iron ore, Manganese, chromite, Magnesite and Granite and
Marble in India and abroad. Credited for opening first Marble Quarry in Oman.
Expertise in setting up new mining ventures.
•
• Mr. Vivek Ranganathan - Mining engineer by qualification with a management
degree in finance and over 12 years of experience in mineral processing & Material
Handling Projects. Has expertise in feasibility studies of new projects of all sizes. Has
held senior level positions in top Mining, Mineral Processing and Material Handling
companies and handled EPC Projects of various sizes.
Property Description
The proposed property of 10.74 acres (4.35 ha) is located at Sy.No: 106, Budawada village,
Chimakurthy Mandal, Prakasham District, Andhra Pradesh.
The Mine Lease was granted for a limited property of 1 ha in Sy.No: 106/1P in the name of
M/s. KL Granites Private Limited vide Director Mines & Geology, Proceeding No: 47796/R3-
1/2011, Dated 29- 12-2011 and the lease was executed vide ADMG Proceeding No:
6041/Q/2007 Dated 11-01-2012 valid for a period up to 25.07.2028.
Page 3 of 18
The Project has Environment clearance ref SEIAA/AP/PKM-317/2015 dated 27.11.2015

valid for a period of 12 years for mining of black galaxy granite – 4647 m3/annum (max) /
2476 m3 /annum (average).
The Project has also obtained Consent for Establishment (CFE) ref P-396/PCB/CFE/RED/ZO-
VJA/2016-2233 dated 12.01.2016 for a period up to 7 years and Consent for operation (CFO)
ref P-396/APPCB/ZO-VJA/CFO/W&A/2015-2626 dated 11.03.2016 which needs to be
renewed.
Figure 2-1 Google Earth Image of the property
Page 4 of 18
The proposed property of 10.74 acres (4.35 ha) is sub divided in Sy.No: 106 as below,
Sl.No Survey No Area in Acres

1 106 / 1P2 4
2 106 / 1P 1 2.81
3 106 / 2 2.41
4 106 / 3 1.5
Total 10.74
Table 2-1 Sy.No 106 - Sub Division
Figure 2-2 FMB Sketch of Sy.No 106

The phase 1 quarrying will be in Sy 106/1P2 within 1 hectares (2.47 acres) and phase 2
quarrying will cover complete Sy.106 after obtaining required statutory approvals and
permissions.
Page 5 of 18
Geology
The Geological formations in the Praksham District is part of Eastern Ghats Belt (EGB) which
extends over 1000 km in length from Brahmani river in orissa to ongole in Andhra Pradesh.
Figure 3-1 Geological map of Eastern Ghats Belt (EGB)

Black granite deposits around Chimakurthy basically are anorthosite gabbro pyroxenites
which have intruded into biotite-hornblende scheme. Black Granite is actually a gabboric
instrusive in granite. The anorthosite gabro-pyroxenite has developed crystal grains of
bronzite (a pyroxene which is golden yellow in colour). The Grain size varies from 80-850
microns, which is appropriate for decorative granite purpose. The black colour is controlled
by the percentage of the mafic minerals namely olivine, ortho & clino opaque pyroxenes,
secondary amphiboles, biotitic, opaque and concentration of Bronzite specks.
Technical Specification
• Compressive Strength: 2777 Kg/cm2
• Ultimate Tensile Strength: 274 Kg/cm2
• Water Absorption: 0.04%
• Specific Gravity: 2.960 Kg/m3
• Hardness (Moh's Scale): 6.5
Page 6 of 18
Resource / Reserve Estimate

Resource Estimate is the Insitu mineable volume and reserve estimate is the marketable or
economic volume. Reasonable assumptions are taken into account for estimation based on
the field visit, geological data available with the study team and comparing with nearby
operating mine. The photo of the working mine located next to the property is shown below,
Figure 4-1 Operating Mine near Sy.No 106
The Resource and Reserve calculation is carried out for 2 scenarios as below,
a) Phase – 1 – considering 1 ha in Sy.No 106 / 1P2
b) Phase 2 – Considering the complete property area – Sy. No 106 – 4.35 ha.
No allowance is given for the limited extraction carried out by previous owner.
Asset
Mineable Area Resource Reserve
Area in Depth Value in
Sl.No Phase Area in in Volume in Volume in
Sq.mtr in m INR
hectare acres Cu.m Cu.m
Crores
1 Phase 1 1 2.47 9999.98 60.00 599999.00 149999.75 975.00
2 Phase 2 2.87 7.09 28699.96 60.00 1721997.00 430499.25 2798.25
Table 4-1 Resource / Reserve Estimate
Page 7 of 18
Figure 4-2 Phase 1 - Mineable Resource
Figure 4-3 Phase 2 - Mineable Resource
Page 8 of 18
Quarrying Operation
The property has been mined earlier and as shown in Figure 5-1 water is logged over an area
of 1.5 acre which shall be dewatered before quarrying. The site preparation may require 4-6
weeks including the dewatering before starting the actual quarrying operation.
Figure 5-1 Sketch showing Bench Face

Quarrying operations shall be carried out by drilling of holes along the perimeter of the
bench, followed by either cutting the stone out of the deposit using saws equipped with
diamond wire, or by splitting the stone using hydraulic splitters or small explosive charges.
Figure 5-2 Diamond wire saw cutting
Once the bench is cut or split loose from the deposit, excavator / loader shall be used to lift
the granite off the bench and transfer it to an inspection area for quality and size
specifications.
Every block that meets the size requirement shall be thoroughly checked for cracks, fissures,
color pattern and other variations quality specifications.
Page 9 of 18
Machinery requirement
Following are the machinery requirement for the Phase 1 and Phase 2 operation. Phase 1
production is considered as 4647 m3 /annum and Phase 2 production is considered as 10000
m3 /annum
Sl.No Equipment Specification Phase 1 Phase 2

Nos Nos
1 Excavator 350 2 3
2 Tippers 10 wheel 2 3
4 Jack Hammer
3 Compressors capacity each 2 3
4 Jack Hammers 9 13
5 Diamond Wire Saw 60 hp 2 3
6 Bore Drill Machine 1 1
7 Generator 125 KVA 1 2
8 Pumps 50 hp 1 1
9 Water Tanker 1 1
10 Welding Machine 1 1
11 Loader 750 1 1
Chisels, Crowbars,
Pick axes spades
Minor tools
and hammers of
12 different sizes. 1 1
13 Drilling rod 2.5' 50 75
5' 50 75
8' 50 75
10' 25 40
12' 25 40
15' 25 40
18' 25 40
20' 10 20
25' 10 20
14 Diamond wire 50 mtr 3 4
15 Utility Vehicle 1 2
Table 5-1 Machinery requirement for quarrying
The capital cost estimate for phase 1 and Phase 2 for the above equipment / items will be
525 lakh and 720 lakh respectively.
It is recommended to hire the excavators, Tippers and Compressors for the first 6-8 month
of operations and the equipment deployment may be planned based on cash flow and
investment capacity.
Page 10 of 18
for 6 month
Sl.No Equipment Specification Remarks
Operation
1 no shall be Rs.2800 per hr incl

1 Excavator 350 hired operator and diesel
1 no shall be Rs.1 lakh per month incl
hired operator. Diesel in our
2 Tippers 10 wheel scope
4 Jack Hammer 2 no shall be Rs.0.5 lakh per month.
3 Compressors capacity hired Diesel in our scope
4 Jack Hammers
5 Diamond Wire Saw 60 hp
6 Bore Drill Machine
7 Generator 125 KVA
8 Pumps 50 hp
9 Water Tanker
10 Welding Machine
11 Loader 750
Chisels,
Crowbars, Pick
axes spades
Minor tools
and hammers 65 Lakh
of different (Same qty
12 sizes. has shown
13 Drilling rod 2.5' above)
5'
8'
10'
12'
15'
18'
20'
25'
14 Diamond wire 50 mtr
15 Utility Vehicle
16 Misc
Table 5-2 Machinery requirement for 6 month operation
Page 11 of 18
Manpower requirement
Following are the manpower requirement for the Phase 1 and Phase 2 operation.
Sl.No Manpower Cost / month Phase 1 Phase 2

Nos Nos
1 Manager - Statutory 80,000 1 1
2 Production In Charge 70,000 1 1
3 Supervisors 25,000 2 3
4 Store keeper 20,000 1 1
5 Office Clerk 20,000 1 1
6 Excavator Operator 18,000 2 3
7 Wire Saw Operator 12,000 2 3
8 Tipper Operator 15,000 2 3
9 Operator Helper 10,000 7 10
10 Utility vehicle Driver 10,000 1 2
11 Stone cutter 15,000 4 8
12 Driller 10,000 16 20
13 Mechanic / Welder 10,000 1 1
14 Cook 10,000 1 1
15 Cook Assistant 8,000 1 2
16 Security 10,000 2 2
Total 45 62
Table 5-3 Manpower requirement for quarrying
Market Information
Black Galaxy granite is an extremely hard igneous stone. Black Galaxy granite is durable,
weather resistant and beautiful. The Black Galaxy granite has a black background with gold
colored specks in it. The gold specks are due to the presence of ferrous rich Enstatine
(Bronzite). The technical geological name for this granite is Gabbric Anorthosite. The material
takes on a very good polish. The ideal use of this material is in interior applications.
Figure 6-1 Black Galaxy Granite with gold specks
Page 12 of 18
The photo taken of the cut block at site suggest the granite to be of good quality.
Figure 6-2 Photo of Cut granite block at site
Page 13 of 18
The market accepts 3 sizes of the quarried block as below,
• Gang saw size – +280 cm X +160 cm X +120 cm

• Mini Gang Saw size - +280 cm X +160 cm X +40 cm
• Cutter size - +260 cm X +120 cm X +100 cm
The commonly used grade variations of the black granite is as below,
Grade Lines Gold Specks
Grade A No line Evenly scattered Big flakes

galaxy
Grade B Comes with one Unevenly scattered Low density and

black line galaxy very dim flakes.
Grade C Comes with more

than two black lines
Table 6-1 black Granite - Grades
The black granite from Chimakurthy has good market acceptance and Rs.80000/m 3 is
considered for financial evaluation.
Financial Analysis
Six Month operation

It is recommended to commence operation with limited capital exposure for first 2000 m3 of
the granite production before scaling up the operation to meet the approved target of 387 m3
/ month (4647 m3 / annum). Following are the inputs considered for the cash flow for first 8
month,
• Mobilization and dewatering in first 2 month.

• Hire of Excavator, Tipper and Compressors.
• All other equipment / items shall be purchased
• 2000 m3 of granite production in 8 month.
The cash flow projection is shown in Table 7-1. M/s Shree Samarth Minerals can target a
profit (pretax) of 12.5 Crores which may be used for the procurement of remaining
equipment / items.
Page 14 of 18
Table 7-1 Cash flow projection for first 8 month
Page 15 of 18
Overall Project Assessment

A high-level cash flow projection is also made for the project – 10 years wherein 22% of the
reserve would be mined. It is also recommended to provision Derrick Crane after 5 th year
when the quarry goes deep to meet the target capacity. The project financials is robust with
expected profit (pretax) of 640 crores.
Table 7-2 Cash flow projection for the Project
Page 16 of 18
Conclusions and Recommendation
The study team is convinced on the project viability based on the field visits, desktop studies
and experience. The Project is financially robust to take care of any slow starts or
inefficiencies although it should be avoided / taken care. Recommendation to proceed should
be positively considered with following points during operations,
• Borewell within the property to be repaired (if not new bore well) to provide water
for the quarrying operations.
• Skillful workers to be employed with experienced supervisor to control the
recovery.
• Property survey shall be carried out prior to commencement of quarrying.
• Environmental monitoring plan should be put in place and followed.
• Safe working practices to be ensured during quarrying operation.
Page 17 of 18
Annexures
Page 18 of 18

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Technical Study Report

Chimakurthy Black Galaxy Granite Mine Project

M/s Shree Samarth Minerals

Report Date – February 26, 2019

Property Description ..................................................................................................................................................... 3

Resource / Reserve Estimate .................................................................................................................................... 7

Quarrying Operation ...................................................................................................................................................... 9

Machinery requirement ....................................................................................................................................... 10

Manpower requirement ...................................................................................................................................... 12

Market Information ..................................................................................................................................................... 12

Financial Analysis ......................................................................................................................................................... 14

Six Month operation .............................................................................................................................................. 14

Overall Project Assessment ................................................................................................................................ 16

Conclusions and Recommendation ..................................................................................................................... 17

Table 4-1 Resource / Reserve Estimate ......................................................................................................................... 7

Table 5-1 Machinery requirement for quarrying................................................................................................... 10

Table 5-2 Machinery requirement for 6 month operation ............................................................................... 11

Table 5-3 Manpower requirement for quarrying .................................................................................................. 12

Table 6-1 black Granite - Grades..................................................................................................................................... 14

Table 7-1 Cash flow projection for first 8 month ................................................................................................... 15

Table 7-2 Cash flow projection for the Project ........................................................................................................ 16

Figure 2-2 FMB Sketch of Sy.No 106 ................................................................................................................................ 5

Figure 3-1 Geological map of Eastern Ghats Belt (EGB) ........................................................................................ 6

Figure 4-1 Operating Mine near Sy.No 106 .................................................................................................................. 7

Figure 4-2 Phase 1 - Mineable Resource........................................................................................................................ 8

Figure 4-3 Phase 2 - Mineable Resource........................................................................................................................ 8

Figure 5-1 Sketch showing Bench Face .......................................................................................................................... 9

Figure 5-2 Diamond wire saw cutting............................................................................................................................. 9

Figure 6-1 Black Galaxy Granite with gold specks................................................................................................. 12

Figure 6-2 Photo of Cut granite block at site ............................................................................................................ 13

1. Evaluating the Project and its feasibility

2. Tentative resource / reserves

3. Tentative manpower and equipment requirement

4. Financial assessment of the project

5. Plan for first 6 month of production

• Mr. K.B. Ramachandra - Mining Engineer by Qualification with over 38 years of

The Project has Environment clearance ref SEIAA/AP/PKM-317/2015 dated 27.11.2015

Figure 2-1 Google Earth Image of the property

Sl.No Survey No Area in Acres

Figure 2-2 FMB Sketch of Sy.No 106

Figure 3-1 Geological map of Eastern Ghats Belt (EGB)

Resource / Reserve Estimate

Figure 4-1 Operating Mine near Sy.No 106

a) Phase – 1 – considering 1 ha in Sy.No 106 / 1P2

Figure 4-2 Phase 1 - Mineable Resource

Figure 4-3 Phase 2 - Mineable Resource

Figure 5-1 Sketch showing Bench Face

Figure 5-2 Diamond wire saw cutting

Sl.No Equipment Specification Phase 1 Phase 2

1 no shall be Rs.2800 per hr incl

Sl.No Manpower Cost / month Phase 1 Phase 2

Figure 6-1 Black Galaxy Granite with gold specks

Figure 6-2 Photo of Cut granite block at site

The market accepts 3 sizes of the quarried block as below,

• Gang saw size – +280 cm X +160 cm X +120 cm

The commonly used grade variations of the black granite is as below,

Grade Lines Gold Specks

Grade A No line Evenly scattered Big flakes

Grade B Comes with one Unevenly scattered Low density and

Grade C Comes with more

Table 6-1 black Granite - Grades

Six Month operation

• Mobilization and dewatering in first 2 month.