Kathmandu, July 21
The Dhaubadi Iron Company Limited (DICL) has moved ahead with an initial plan to conduct mining in at least two of the six blocks identified for Iron Ore Mineralisation Area at Duaubadi in Hupsekot Rural Municipality–05 in Nawalparasi (East).
Issuing a letter on June 24, the company announced that it awarded the contract for the preparation of Mining Scheme Report for two of its blocks – Pokhari and Ratekhola – to Ekjati Engineering Pvt. Ltd.
The report will provide an operational blueprint detailing how the company will extract minerals systematically and safely.
According to the preliminary estimates of the Department of Mines and Geology (DMG), Duaubadi mineral area has 100 million tonnes iron ore deposits. The project details published by the Investment Board of Nepal (IBN) for the Investment Summit 2024, estimates that Pokhari has 7.3 million tonnes ore and Ratekhola 18 million tonnes.
Other blocks include Dhaubadi 32.5 tonnes, Durlunga 14.2 million tonnes, Ramche (North) 15 million tonnes, and Ramche (South) 9.3 million tonnes.
According to Dr. Janak Bahadur Chand, CEO of the DICL, the company is in the phase of quality testing or chemical analysis of the sample deposits from the sites.
"We have sent the sample to labs for the chemical analysis. The analysis will tell us what will be the share of iron ore in the total minerals. It will take 2-4 months," he said.
Work for the preparation of the Detailed Project Report (DPR) will also begin soon. Eleven consultants have responded to the company's call for the DPR preparation, and the task is supposed to complete in one-and-a-half years. Earlier, in absence of multi-year policy for DPR preparation had created hurdles which is no more a case.
The company has also performed drilling in multiple locations to extract materials for the testing and analysis. While the drilling was required to go 2200 metres down, the progress is made up to 1512 metres. This drilling has provided the required number and quality of samples, and the company said that further drilling might not be needed.
At Dhaubadi, iron band thickness is estimated at 15-30 metres and features alternating sequences of hematite-rich bands and slate/phyllite.
However, since the project is in its initial phase, it has to achieve multiple milestones before it begins industrial projection. The Rs. 51.25 billion (US$ 394.2 million) project (according to 2024 estimates) is supposed to generate US$391 million in revenue and earn net profit of $29 million.
According to Dr. Chand, if things go as planned, the company will begin production by early 2030.
The information published the IBN also mentions that Daubadi has reserves of 126.76 million tonnes of Hematite ore. Earlier chemical analysis has shown that it has 17 per cent to 58 per cent total iron (TFe) within mineralisation zone. Meanwhile, the metallurgical test has shown that it has 35 per cent iron on an average.
Dr. Chand said that apart from iron, the company will produce silica and quartzite as well as gravel needed for the railway projects as the by-products. The plant will also produce about 70 megawatts of electricity. "It is a zero-waste project," he said. The project is expected to substitute about one fourth of the total iron demand in the country which is estimated to exceed 2 million tonnes.
Meanwhile, the government has reannounced that the government's share in the DICL would be reduced and private sector companies will be invited to run the project in Public-Private-Partnership (PPP) model. Finance Minister Dr. Swarnim Wagle made this announcement in the budget for this year 2026/27.
Published in The Rising Nepal daily on 22 July 2026.
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