The extraction will take place at the Panna mine in the state of Madhya Pradesh, India. Credit: Nmaneer/Shutterstock.

Indian state-run miner NMDC is set to extract 6,500 carats of diamonds, valued at $3.4m (Rs294.13m), this fiscal year from the Panna mine in the state of Madhya Pradesh, India.

This follows the receipt of mining clearances last year, according to a report by Reuters, citing sources.

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The company faced delays in obtaining environmental clearances, which resulted in a halt to mining activities for more than three years due to the mine’s proximity to a tiger reserve.

The Supreme Court subsequently granted NMDC permission to resume mining, provided it adheres to specific guidelines, thus allowing the company to recommence operations, according to the report.

While NMDC has not yet initiated new rounds of mining, it is currently focused on extracting and processing diamonds from existing ore stockpiles at the Panna mine.

“We will start ore mining from the mines in two-three months, and in the meanwhile, diamonds are processed through feeding of old stockpiles,” the company stated in an e-mailed response to Reuters.

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Since the resumption of operations, NMDC has extracted diamonds worth 3,700 carats, equivalent to $1.93m, from the ore, the report said.

The Panna mine spans an area of 275.96 hectares and has been operational since the early 1970s, making it the “only mechanised diamond mine in India”.

Other global and domestic mining companies have also attempted to extract diamonds at the Bunder project, located near the Panna reserve but with limited success.

Before exiting the Bunder project in 2016–17, Rio Tinto invested approximately $90m over 14 years on the site.

Since Rio Tinto’s departure, mining activities at the Bunder project have not commenced, primarily due to concerns regarding its location within a forested area that is home to tigers and other wildlife.