Hutti Gold Maines

Hutti Gold Mines Co. Ltd.

INTRODUCTION

Gold has been known and highly valued since pre-historical time. Gold in antiquity

was relatively easy to obtain geologically. Primary deposition, the first source of gold, is

in igneous rocks. A deposit usually needs some form of secondary enrichment to be

economically viable either chemical or physical changes like erosion or solutions, which

concentrates the gold in sulfides or quartz, These deposits are termed reef or vein, and are

eroded by weathering, with most of the gold being transported into stream beds where,

congregating with other heavy minerals, it forms placer deposits. In all these deposits the

gold is in its native form, that is, as a shiny yellow metal.

Gold has been 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 primary goal of the alchemists was to produce gold from other substances,

such as lead – presumably by the interaction with a mythical substance called the

philosopher’s stone. Although they never succeeded in this attempt, the alchemists

promoted an interest in what can be done with substances, and this laid a foundation for

today’s chemistry. Their symbol for gold was the circle with a point at its center which

was also the astrological symbol, the Egyptian hieroglyph and ancient Chinese character

for the Sun.

Institute of Management Studies Davangere Page 1


INDUSTRY PROFILE

While exploration and mining can sometimes be conducted by individual

entrepreneurs or small business, most modern-day mines are large enterprises requiring

large amounts of capital to establish. Consequently, the mining sector of the industry is

dominated by large, often multinational, mostly publicly-listed companies. See Category:

Mining companies for a list. However, what are referred to as the 'mining industry' are

actually two sectors, one specializing in exploration for new resources, the other

specializing in mining those resources. The exploration sector is typically made up of

individuals and small mineral resource companies dependent on public investment. The

mining sector is typically large and multi-national companies sustained by mineral

production from their mining operations.

Miners today do more than just dig tunnels in the Earth's subsurface. There are

many different jobs, direct and indirect, in the mining industry, ranging from engineers

and lab technicians to geologists and environmental specialists. Beyond employment

directly linked to mine-site activity, the modern mining industry also employs many other

professionals, including accountants, lawyers, sales representatives, public relations

specialists, not to mention thousands of men and women involved who manufacture the

machines and equipment necessary to mine minerals.



PRODUCT PROFILE

Gold has long been 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 primary goal of the alchemist was to produce gold from other substances,

such as lead – presumably by the interaction with a mythical substance called the

philosopher’s stone. Although they never succeeded in what can be done with substances,

and this laid a foundation for today’s chemistry. Their symbol for gold was the circle

with a point at its center which was also the astrological symbol, the Egyptian hieroglyph

and the ancient Chinese character for the Sun.

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 exchange it for currency.



COMPANY PROFILE

Hutti Gold Mines company Ltd (HGML) a government of Karnataka under taking

(established in 1947 as Hyderabad gold mines) have the unique destinations of being the

only producer of primary Gold in the country the company has its corporate office at

Bangalore and operates Hutti gold units in Raichur district. The gold unit comprises Hutti

underground gold mine, Uti open cost mine and Hire Buddini exploratory mine. Major

expansion including the extended capacity of the metallurgical plant in a phase manner is

also under consideration. The Hutti unit are fully integrated unit with smelting capacities

to process Gold ore of 6,00,000 tons per annum and Chitradurga Gold unit (CGU)

2,61,000. Hutti Gold Mines Company Ltd in the state has joined bandwagon of the

leading gold producing companies in the world by becoming the 40th member of the

world Gold council (WGC). The company is committed to developing long life safe and

environmentally responsible operations

HISTORY

The mine is probably one of the ancient metal mines in the world dating to the pre-

Ashokan period carbon dating of the old timber collected from old workings indicated

about 2000 yrs of ancient mining activity Between 1887 and 1920 nearly 7.40 tons of

gold was recovered from very rich ore at an average yield of 19 grams per tone. Most of

the ore was from the main mine which was worked by Hutti (NIZAMS) gold mine and of

shoot of Hyderabad (DECCAN) Company. The main mines were up to a dept of 1056

mts. The industry was closed down in 1920 due to technical difficulties and First World

War.



In 1937 the Nizam’s decided to prospect the area with a view to response the

mines. In 1940 based on favorable exploratory results it was decided to install a plant to

treat 100 TPS pre day, but before the plant could be commissioned ,mining operation

were suspended from 1942 to 1946 due to second world war , the mine was shut down

and only pumping was carried out.

After the war, the Hyderabad gold mines company Ltd was found in 1947 and

regular mine production started in September 1948 at the rate of 130 tons per day. By

1972 this was progressively increased to 600 tons per day. In the year 1999 increased to

910 tone per day.

With abolition of gold control at commencement of new mines policies HGML

was in a position to greatly expand its activities it was proposed to increased production

from 2.6 lakhs tones of ore per annum to 5 lakhs tones of ore pre annum after completion

of the modernization and expansion programmed by introducing mechanized mining

latest CIP treatment process technology from the year 2000 to 2001

LOCATION

Hutti is located about 80 kms west of Raichur , about 500 kms north of Bangalore

and is considering has one of the prestigious stable under ground metal mine in India

located in north west periphery of Hutti-Muski green stone belt. Hutti underground gold

mine of HGML is one of the deepest working in India (after closure of Kolar Gold Mines

of BGML and the Mosabani Kolar Mines of HCL). Since the deepest development point

depth 867.3 dept. (sinking). The Hutti Gold Mines ( including satellite mines) have so far

produced 51.15 tons of gold metal 8.65 million tons of ore at an average grade of 5.91

G/T (up to end of march 2003) during the last 56 years of mining.

REGISTERED OFFICE



The registered office of the company is presently situated at 3 rd Floor, KHB,

Shopping complex, National Games village, Koramangala, Bangalore-560047

WORK FORCE

Due to very nature of auriferous lodes mining operation of the company is large

labor intensive. The total number of employees on its role as on Oct 31 2006 was 4095.

The company is undertaking selective and judicious mechanization where ever necessary

to increase production and productivity.

HUTTI GROUP OF MINES

The Hutti –Muski schist belt bearing gold mineralization stretches over a length

of about 70 Kms and an average width of 6 Kms. It occupies an area of 750 square Kms

which extends from Krishna river in north of up to Tungabhadra river in the south. And

its one of the most important auriferous archaen green stone belt of the southern Indian

shield. After independence, search for noble metals was identified. The past and recent

work of recommence and preliminary regional exploration activity geological survey of

India (field season 1961-62 onwards) and detailed exploration by Mineral Exploration

Corporation Limited (MECL) and HGML (1986 onwards) the belt witnessed a whole

spectrum of investigation, these includes regional mapping of the entire belt,

geographical and geochemical survey. Large scale mapping, detailed drilling and

exploratory mining in selected areas. Nearly 15 deposit\prospect have been explored in

the northern and southern parts of a belt. The geographical terrain extending from Muski-

Buddini to Uti is significant and important. From the economic point of view, three mines

viz. Hutti Gold Mines, Uti Gold Mines and Hera buddini project owned by HGML are

producing gold ore at present. Additionally there are many small deposits such as

Tuppadur, Maski-buddini, Honnali, Chinchgiri, Yaradoni; Ballapur Block with limited

potential in comparison the southern part of the belt is not well explored. A vast area

between Maski and southern end of the schist is covered by thick block cotton soil and is

covered by canal irrigation.



MINING AND TREATMENTS

HGML’s production has steadily increased over the years. In this process HGML

has been able to develop much needed technological expertise in the field and prepared

itself to take new challenges growth and development. Over the years the company has

implemented a number of technologies up dating schemes in mining and smelting leading

to increase competitiveness of its operation.

HGML’s operation starts with mining of gold ore. The huge/bulk mining methods

viz. large Dia blast whole stopping and sublevel mining have achieved higher safety and

productivity. The ore is crushed, ground to very fine powder. The grinding output is

subjected to cyanidation and CIP (Carbon in pulp) process, where metallic gold leaches

and gets absorbed on activated carbon. Gold is recovered through two routes (1) Gravity

concentration, and (2) leaching, CIP elution and electro winning process and there after

smelting to reduce saleable gold bullion bar.

Total Ore Mined so far HGML 10.97 Million tons

Total Gold produced 66.20 tons

Ore reserves estimated as on 31-04-2006(proved and probable reserves)

7.01 million tons with 6.28 gm/tons grade total gold 44.42 Tons

Present scale of production 6.04 lakhs TPA of ore.3.50 tones of gold.



VISION & MISSION

To become one of the most vibrant, self reliant, financially viable and steady growths

oriented organization. The corporate mission is:

Mine with a human face.

Achieve Operational, Financial and Social objectives.

Achieve a minimum of 20 percent return on equity to the shareholders.

Improve productivity and profitability.

Have cost management control and reduction.

Provide long term financial stability.

Generate internal resources for steady growth of 10 percent in production.

Register steady growth in terms of percent of capacity utilization, production,

income and profitability.

Innovative methods of production.

Introduction of modern and effective management control systems.

Promote harmonious and cordial relationships.

Promote welfare and community development in Hutti village.

Have environment friendly and healthy mining and production process.



OBJECTIVES

The main objectives of the organization are:

To search for gold, other minerals and precious deposits in Karnataka state.

To maintain or join with any other persons/companies in purchasing , constructing

and maintaining roads, railways, buildings, machineries, mills, reservoirs and

other works conductive to the objectives of the company.

To acquire work and dispose of and deal in any mines, metals, minerals, clay and

other like substances and to acquire, produce by cultivation, manufacture, deal in

or other wise turn in to account any minerals.

To carry on the business of general electric power supply company in all branches

and to construct, lay-down, establish, fix and carry out all necessary power

stations, cable wires, liners, accumulators, lamps and other works to generate

accumulators, distribute and supply electricity and to light cities, towns, streets,

markets, theaters, buildings and place of both public and private.

Machinery

Heavy machinery is needed in mining to break and remove rocks of diverse

hardness and toughness. Bulldozers, drills, explosives and trucks are important for

digging into the land, especially in surface mining.

Underground mining, like continuous mining, tends to be more technologically

sophisticated because of the dangers and expense of subsurface tunneling.



Records

The deepest mine in the world: Savuka Mine in the North West Province, South

Africa at 3,774 meters [24]

East Rand Mine in Boksburg, South Africa briefly held the record at 3,585 meters

The first mine declared the deepest in the world was TauTona in Carleton Ville,

South Africa at 3,581 meters. Plans exist to extend TauTona to a depth of 3,902

meters by July 2008, which will make it the deepest again. [24]

The deepest mine in Europe: Boulby Mine England at 2800 meters

The deepest open pit mine in the world: Bingham Canyon Mine in Bingham

Canyon, Utah, USA at over 1,200 meters

The second deepest open pit copper mine in the world: Chuquicamata in

Chuquicamata, Chile at 900 meters

Gold mining

Gold mining consists of the processes and techniques employed in the removal of

gold from the ground. There are several techniques by which gold may be extracted from

earth and rock:

Hard rock mining

Hard rock mining at the Associated Gold Mine, Hard rock gold mining is done

when the gold is encased in rock, rather than as particles in loose sediment. Sometimes

open-pit mining is used, such as the Ft. Knox Mine in central Alaska. Other gold mines

use underground mining, where the ore is extracted through tunnels or shafts. Hard rock

mining produces most of the world's gold, such as Hutti Gold Mines.

PRODUCTION (2007-2008):



For the year under review 7,73,577 Metric tones of ore were treated and 4296.45

Kgs. (Mines Weight) gold was recovered.



ORGANIZATIONS STRUCTURE


DGM (Metallurgy)

CMD

Board of Directors

FinanceHRDDGM (Mining)

Finance ManagerHRMSr manager (met)Sr Manager

Dep. Finance Mgr.DHRMManager (met)Manager

Sr ManagerSr Welfare OfficerDM (met)Deputy Manager

ManagerPersonal Officer W/OAssistant

Sr Engineers

Assistant ManagerAssistant P/O W/OEngineers

Assistant Clerk Clerk

GM


PRODUCTION DEPARTMENT

Introduction:

Production is the basic activity of all industrial units. All other activities revolve

around this activity. The end product of the production activity is the creation of goods

and services for the satisfaction of the human wants. The production activity is nothing

but the step-by-step conversion of one form of material into another either chemically or

mechanically. This is done in factories which house manufacturing processes. The basic

input of the production processes are men, machines, plant, services and methods.

An organization capabilities and the intent are strongly reflected in the product it

manufactures. The manufacturing competencies and facilities echo truly, the R&D extent

and the ability to implement it for the best of the market it targets. The product of mine is

used as raw materials on which the processing is done to create or enhance the form

utility. It should note that the finished product of one manufacturing unit does not always

furnish a ready made product for the ultimate consumption. In a chain of manufacturing

activities, the finished product of processor sometimes become the raw material (or

component) for the other manufacturing firms falling next in the sequence.

HGML Company has world class manufacturing facilities having to extract the

Gold as well as finished product will completed through manufacturing process.





Gold is recovered through two routes:

Gravity Concentration

Leaching, CIP, Elution, Electro winning process and there after smelting produce

saleable Gold Bullion Bar

DBT Plant:

Demonstration Bio Reactor Plant with the collaboration of department of Bio-

Technology, Government of India has been setup to maximize recoveries from the

refractory Ores since the resources of free Gold Ore are limited.

Due to the limitation of processing of refractory Ore through the concentrated

smelting route, alternative recovery route such as Bio-Leaching need to be pursued

vigorously.



A major initiative has been taken by HGML through the setting up of

demonstration Bio Reactor plant being the first of its kind in India. Gold Ore occurs in

native form is disseminated in a quartz matrix such Ores referred to as free milling Ores

are treated in a Conventional process with a Cyanide to solubilize Gold-cyanide complex.

Whereas in case Gold Ores are found to be refractory in nature i.e. gold is associated with

sulphides such as Pyrite and Arsenopyrite. In the absence of period Bio treatment direct

cyanidation of a refractory Gold bearing sulphides will yield only 30-40% while after

Boi-liberation the Gold recovers can be enhance to more than 80-90%. Its being planned

to upstage the Demonstrator plant to a large scale plant for G.R. Halli and Ajjanahalli

refractory Ores.

Production Process - Mining

There are five operating gold bearing Reefs namely the strike Reef H/W and F/W,

the Z1 Reef the middle Reef and the Oakley's Reef.

The strike Reef Hang wall and footwall merge at 15 L and becomes one reef as

strike Reef Hang Wall.

The Reefs run parallel dipping between 62 to 72 with width varying from 2.5

Meters to as high as 20 Meters. The average being 5 to 8 meters.

Simultaneous mining is done in all the reefs at various depths to have an average

run of mine grade of around 5.5 to 6.0 g/t. Being an old mine optimum mechanization has

been done since the shafts and other entries to the reefs are small and pose a constraint

for lowering high productive equipments.

The mine is producing around 1300MT to 1400 MT of ore per day.

Shafts:



The access to the Mine is by two vertical shafts and one incline shaft. The shafts

are concrete lined rectangular shafts and are in full operation up to 27 L corresponding to

a depth of 772 mts in Mallappa shaft and 774 mts at central shaft.

The third is the Village shaft which is inclined shaft and goes down to 15th level

i.e. 463mts from the surface.

Both the vertical shafts are in the process of sinking and are below 26th level and

is planned to be deepened beyond 30th Level.

All the three shafts are interconnected at different levels to have better access,

ventilation facilities, movement of men and material.

Levels: -

Levels are 2.4 x 2.4in sections and level interval is normally 30m vertical. The

intervals of the levels are kept at 30 Mts due to nature of the ore body and also the

drilling equipments available indigenously to drill level-to-level blast holes without much

deviation of the holes.

A greater distance increases the possibility of missing areas of payable ore, during

development due to the extremely erratic gold distribution.

METHOD OF WORKING:

Stopping in earlier days was by shrinkage method of mining and was restricted up

to 15 L from 15 L to 20 L the method was by cut and Fill method. Shrinkage method of

mining has been stopped long back with entire ore withdrawn.

1. Cut & Fill:

This method is being continued in those stopes, which were already started, and

no new cut & Fill stopes are being opened.



In this method of mining the stope block is 60 Mts to 100 Mts in length and

between the two levels i.e. 30 Mts height.

Initially the roof of the starting level is stripped and heighten to about 4 Mts. A 40

Cms to 60 Cms concrete mat is laid at 2 Mts height from floor level. Openings in the

concrete mat 1 mt by 1 mt are provided at intervals of 10 to 15 mts all along the length of

the concrete mat, and ore withdrawal chutes are fixed to draw the ore and fill the mine

cars.

Drilling and blasting of the back either by drilling upper holes or by drilling

horizontal holes continue mining. Rock bolting of the blasted roof is done before

withdrawal of the muck. Once the height of the back is 4.8 Mts from the floor,

preparation for the filling is done by extending the ore pass rings. About 2 mts of the

height is filled with classified mill tailing and a gap of 2.4 mts left unfilled.

After the floor becomes hard the next cycle of drilling and blasting starts. This

operation is repeated till it reaches the above level. The blasted ore in the stopes is lifted

using tyre mounted hopper loader and dumped in ore pass in the stope. Which is collected

from the bottom level through chutes and filled in mine cars and trammed to the grizzly

by loco.

2. Blast Hole Stopping method (with post filling)

Presently 90% of the stopping tonnage is derived from blast hole stopes. The size

of the block is generally 60 Mts height comprising of two levels of 30 Mts and 60 Mts in

length.

i) In blast hole stopes when the ore body is more than 3 mts in width and

when there exist no mined out block over the stope block, then level to level

drilling using 115 mm dia holes are drilled. These holes are drilled against a slot

raise excavated at one end of the stope by drop raise technique. The slot raise is

the free face for the blast holes to break in. A combination of 57 mm dia holes of



10 to 15 mts depth are also drilled when it is required to cover wider ore bodies

where 115 mm dia holes are not possible.

ii) When the ore body is narrow or when there exist a mined out stope

above the proposed block then a sub level is excavated keeping 10 mts as the

crown piller or when the ore body is weak and may cause dilution a sub level is

excavated to have a control on the hole depth/deviation.

From the sub-levels 115 mm dia holes are drilled and at times 57mm hole are also

drilled depending on the depth of the hole and nature of the ore body.

At the draw level a foot wale haulage is excavated about 13 mts away from the

footwall contact of the ore body. From the footwall haulage draw crosscuts are driven at

an interval so that a pillar of 8 to 10 mts are maintained between the two draw crosscuts.

The blasted ore is drawn through these draw cross cuts using EIMCO 824 tyre mounted

loader and loaded in to Mine cars of 3.5 MT and 1.5 MT in Mine car in case of 21 RS

Loader and these cars are hauled to the grizzly and dumped into ore transfer raises using

battery operated locomotives.

After the ore is totally mined out the void is then filled up with classified mill

tailing. For this 0.75 mts thick R.C.C concrete walls are erected in each of the draw cross

and other openings to the stope with water decantation pipe to drain out the water.

Blast Hole Open Stope:-

Since 2004 blast hole open stopes are in operation at few locations on

experimental basis where the method of mining is same as that in post filled stopes. In

this the stope void is not required to be filled up, however to prevent any air blast all

entries to the stope like draw cross-cuts are to be erected with seals to prevent any effect

of air blast in case of any wall collapse.



Ground Control Monitoring: -

To study the behaviors of the wall rocks the crown pillar and pillars between the

two stopes multi point bore hole extensometers and stress measurement cells are

installed. Tape extensometer and convergence stations are installed at the draw levels

footwall haulage and crosscuts to study the rock pressure.

Underground Ore Transport system:-

Facilities of ore hoisting are provided in all the three shafts. Mallapa shaft is

provided with a multi level cage-cum skip hoisting system and fully automatic winder

hoisting ore from 24 L to surface. At central shaft and village shaft with cage -cum-skip

system to hoist from different levels.

At 20 L 3 nos. of rock breakers are installed two for ore handling and others for

waste rock handling.

The two rock breakers for ore handling are installed over a bin between 20 L to 22

L having about 2500 MT capacity. The ore is brought to the grizzly by 3.5 MT capacity

GB cars using 5T Battery locomotive from various ore transfers and the size is reduced to

minus 45 cms. At 22 L a jaw crusher further reduces the size to minus 20 cm and is fed

into the ore bin between 22 L to 24 L having a similar capacity.

At 24 L through the vibrating feeder the ore is fed to the hopper via conveyor belt

and the ore hoisted to the surface through the automatic winder having a skip capacity of

5.6 MT.

Attempts are made to get the ore from upper levels to 20 L through ore transfers

system. However small tonnages, which cannot be brought to the ore transfers, are being

differentlevels.



Sand Stowing: -

For filling of voids in cut fill and blast hole stoping methods, on surface two silos

of 1000 T capacity are made at one site and 3 silos of 150 MT capacities are made at

another site.

For the 2000 T capacity silos, 2 Nos. of 6" dia bore holes are drilled from surface

to 7L and from 7L to the lower levels bore holes are drilled level to level and connected

carrying the mill tailings to the stopes.

For the 3 Nos. 150 T silos two pipelines are run from surface to the stopes

through old shafts and raises.

The filling capacity at prevent is approximately 600 MT of classified mill tailing.

Ventilation: -

As Mining is being carried out in all the five reefs, ventilation net working has

always been a problem with small cross-sections of shafts and the wide spread out

workings.

There are 5 nos. of vertical exhaust fans installed on top of the old dis-used shafts

and the intake is mainly through the 3 nos. of working shafts. Action is taken to further

improve the ventilation requirement for working of the lower levels by bringing down

more quantity of fresh air through some of the old shafts and re-routing the air

environment.



METALLURGICAL DEPARTMENT:

Role: to extract Gold of 91% pure from ROM at the optimal cost.

Responsibility:

Ensure higher Productivity with least risk by adopting the following:

Efficient man power utilization.

Efficient machine utilization.

Efficient process control.

Maintaining cost effectiveness.

Effective administration.

Effective co-ordination among officers and workers.

Inculcating consciousness about environmental protection and managing

gold house keeping.

Metallurgical Operation:

The Gold extraction process in HGML practices Mineral Processing, Hydro

electro & Pyro Metallurgical routes. The Major unit processes involved is described

below:

Crushing.

Grinding.

Cyanidation.

CIP, Elution, and Electro winning.

Smelting.

Assaying and R&D.



Crushing:

Mine ore is drawn mainly from the adjacent Mallapa Shaft ore-bin of 1000 tonnes

capacity, while ore from the other shafts is brought in to the crushing circuit via a surface

ore-bin of about 200 tonnes capacity equipped with chain feeder and inclined conveyor

belt etc.

ROM is crushed to -10 mm size in three stages. In the first stage there are three

nos. of Kue Ken Jaw crushers, which act as primary crusher and crushed ore stored in

200 MT. In the second stage 2 Nos. of 3' standard symon cone crusher act as secondary

crusher and in the tertiary stage, there are 2 nos. of 3' short head and 2 nos. of 4' short

head symon cone crushers. These crushers are in close circuit with vibrating screen.

Crushed product is stored in a fine ore bin of 1500 tons capacity before feeding to

grinding plant. Automatic sampler and weight meter and weighbridge provide the

necessary production input details.

Grinding:

Mill Capacity: 1950 TPD

The milling/Grinding process of gold ore in Hutti employs two distinct grinding

techniques.

In the first technique grinding is done in two stages i.e one primary mill and 3

nos. of secondary tube mills constitute one stream of grinding. Two such streams are

there. The discharge of these mills are passed on strake table spread with blankets which

recover coarse gold by gravity process, and the system is in close circuit operation.

In the second technique, single stage grinding is done in four nos. of independent

ball mills in close circuit with cyclone classification system. The mill discharge is passed

through knelson concentrators to recover the free gold. The stake tables concentrate and

knelson concentrate is further upgraded on james table to produce smelt able grade of

gold.



Cyanidation and carbon in pulp process (CIP):

The cyclone overflow from both the techniques is subjected to thickening in a

High rate thickener to remove excess water, which is passed through a series of carbon

column to recover dissolved gold. The thickened pulp of specific solid content is mixed

with cyanide for leaching in a series of mechanical agitators at alkaline media. To

facilitate leaching hydrogen peroxide assisted with compressed air is used to improve

oxygen potential in circuit. The cyanide leached pulp is sent to carbon-in-pulp(CIP) unit,

agitated with activated carbon in suspension. The dissolved gold is then absorbed on

carbon as sodium auro cyanide. The gold loaded carbon is removed from th eCIP

periodically and carbon is washed with water and given acid and alkaline treatment.

Elution and Electro-winning Plant:

The clean & gold loaded carbon is elution columns by maintaining the specific

parameters. The gold in the pregnant solution is recovered in electrolytic cells using steel

wool as a cathode on which the gold is deposited. The stripped carbon that retails a very

little gold is activated and reused.

Refinery (Smelting):

The upgraded James table concentrate is roasted, magneted and finally smelted

into bullion buttons. The gold loaded steel wool is manually removed periodically,

subjected to acid digestion, drying and smelted to obtain bullion buttons. The bullion

buttons thus obtained from table concentrate and steel wool are cast into salable bullion

bars weighing 5 to 11kgs having a purity of 88-91% of gild, 8-11% of silver and balance

impurity.



Assay and R&D Lab:

Activities involved in Assay lab /Sample testing are:

Crushing of Underground samples.

Filtering and drying of grinding samples.

Fluxing.

Parting.

Making cupels.

Scrapping of crucibles.

Refactory work.

Preparation of standard solution and cyanide artidotes.

Other miscellaneous work to find out Assay values of mine and mill samples.

To do any other work as assigned from the time to time.



GOLD ANALYSING MACHINE

This LAB is India’s No. 1 lab for Gold Analysis

Activities carried out in R&D Lab:

1. Quality control.

2. Pollution control.

air pollution (Process emission, flue gas emission, ambient air monitoring)

Effluent analysis.

Domestic sewage analysis.

3. Mineral analysis

4. To carryout/involve in R&D project works taken up by the company.

5. To prepare solution required for R&D works.

6. To do any other work as assigned from time to time.



PRODUCTION STATISTICS FOR 12 YEARS (i.e. from 1993-00 to 2005)

HUTTI GOLD UNIT CHITRAURGA GOLD UNTI (Ajjanahalli +G.R. Halli)

TOTAL (HGU +CGU)

(HUTTI +UTI + HIRA – BUDDINI MINES)

Year Ore Hoisted (Hutti only Tonnes)

Ore Treated (Hutti+NP) (Tonnes)

(Feed) Grade (G/t.)

Net Grade

Gold Produced

Ore Treated

Net Grade

Gold Produced

Total Produced by HGM Co. Ltd. (Kgs)

(G/t.) (Kgs) (Tonnes) (G/t.) (Kgs)

1993-94 1,79,924 1,78,338 5.73 5.42 966.409 ----- ---- ---- 966.409

1994-95 2,32,460 2,46,481 5.51 5.04 124.76 14859 0.43 6.395 1249.16

1995-96 2,56,912 2,32,626 4.82 4.35 1011.24 44262 1.44 49.619 1060.86

1996-97 2,63,272 2,83,083 5.52 4.97 1408.05 96350 1.86 182.33 1590.38

1997-98 2,77,430 2,93,640 5.3 4.9 1438.07 119942 1.75 209.866 1647.96

1998-99 291214 3,23,974 4.93 4.4 1427.1 130293 1.68 219.663 1646.77

1999-00 2,54,529 3,49,084 4.4 4 1395.82 127721 1.45 184.77 1580.59

2000-01 2,60,199 3,35,845 5.62 5.31 1784.99 127257 1.36 173.624 1958.61

2001-02 3,79,251 4,09,437 6.11 5.67 2333.49 57276 1.43 82.221 2415.71

2002-03 4,60,637 5,25,928 5.4 5.02 2640.5 61384 1.11 68.35 2708.85

2003-04 4,83,263 6,23,125 5.77 5.4 3096.54 ----- --- ---- 3096.54

2004-05 4,80,826 5,92,685 6.22 5.9 3507.6 ----- ---- ---- 3507.61



FINANCE DEPARTMENT

Structure of Financial Department


Trust Account

Managing Director

Executive Director

Personal SectionCost accountChartered Accountant

Cash AccountEmployee Account Inventory Account

HOD


Introduction:

Accounting is the art of recording, classifying and summarizing in a significant

manner and in terms of money, transactions and events which are in part at least, of

financial character and interpreting the result there off.

Financial department is a vital department of a organization. Finance is concerned

with providing and using cash and credit for carrying on business correctly.

Finance is regarded as a life blood of a business enterprise this is because on the

modern economy finance is one of the basic needs of all of kinds of economics activities.

It is a matter key, which provided access to all source to be employed in the

manufacturing and mechanizing activities. The finance department should decide when,

where and how to achieve funds to meet the firms, investment needs.

The control issue before the finance department is to determine proportion of

equity and dept the mix of equity and dept is knows as the capital structure being one of

the best run co-operative mills in India.



FUNCTION OF FINANCE DEPARTMENT:

To prepare and maintain journal books, cash and bank, books ledger A/c and a

trail balance

To prepare trading A/c

To prepare profit & loss A/c

To prepare balance sheet

Maintenance of account is undertaken

Rate fixing

Suppliers bill paying

Cash & bank balance

To make calculation and decision regarding the funds of the company

Finance dept deals with the financial activities of the company. It consist of different

section

Inventory section

Costing section

Bills section

Companies account

Sales tax account

Employee account

Trust account



INVENTORY SECTION

Brief description about Inventory

Indent details like, number, Cost code, Material code and Quantity are entered.

After processing the bills the Material receipts notes (MRN) details like, Material

code, Quality, Bill amount, Freight, Insurance, Entry tax are entered to arrive at

unit rate of each material.

Through inventory software weighted average rate is arrived and the same is

applied for all material issue. Store stock ledger and closing master reports are

also computed.

Stock ledger is sent to store for reconciliation with Bin card balances.

Cost code with consumption report is given to costing for completion of the cost

sheet.

PROBLEM AREAS IN INVENTORY

Flow of indents / Materials receipt notes must be uniform i.e. document should

not be piled up and dumped on one day

The writing must be legible

Unit of measurement mentioned in the issue/receipt document should agree with

master data created in the beginning

Maximum care should be exercise while material code in issue/receipt document

to avoid duplication /wrong booking of cods which may affect the cost sheet

Cost code booking in indents is critical to compute correct cost sheet.

Reconciliation of ledger balance and ground stock to be carried out at regular

intervals.



The main principle in this company is Opening balance+ Receipt = Weighted

average. The total material of different section are divided into 8 parts

Chemical & Building: - e.g. cement nails, bolts, nuts, acid, sodium cyanide, soda,

potassium nitrate etc.

U/G & Electrical spares: - e.g. core bricks, drill loads.

Machinery spares: - e.g. generators, compressors.

Steel materials & Pipe fittings

Tools & Misc. materials

Fuel, oil & lubricants

Transport spares

Explosive

Ballast

Sand & Red earth

Cost code materials using section

1. U/G : - 3000 - 4999

2. Mill : - 5000 - 5105

3. Engineering : - 6000 - 6931

4. Misc-expenses : - 120 - 906



ABC ANANYSIS

1. A class items : - Where the total consumption during the year is above

20000\- are called class “A” items

2. B class items : - Where the total consumption during the year is below

20000\- and above 3000\- then these items comes under class “B” items

3. C class items : - Where the total consumption is below 3000\- are called “C”

items

COSTING SECTION

The HGML maintained the standard costing system. Costing section makes the

companies all department expenses checked and then exact cost will de shown according

to the expenses they are incurred while every day’s consumption. In every month this

department will shown the transaction expenses accurately in a print of copies. Also

income from any department will be prepared according to the Personnel Code and cost

Centre of the company provided for the different departments and different employees,

on the basis of this cost Sheet will be prepared.

The main purpose of these formalities, in every month what the unit of Gold takes

the expenses will tally with the expenses of all other department, and then tallied both

different will be Profit or Loss of the company. And also to ascertain the cost per metric

ton and cost per gram of the gold.



ACCOUNTING SECTION

SIGNIFICANT ACCOUNTING POLICIES

1. Accounting System

a) Financial statement have been prepared under historical cost convention and

in accordance with the accounting standards referred to in sub-section (3C)

of section 211 of companies Act, 1956.

b) Financial statement has been prepared on the fundamental accounting

assumption of going concern and on accrual system of accounting except as

stated in 2.3 & 2. 5

c) Expenses accruing in the financial year and ascertainable with reasonable

d) accuracy on the cut-off date are provided from in the accounts

2. Revenue Recognition

a) Sales are accounted net of discount.

b) Sale of Bullion is accounted on the basis of rate confirmation fineness and

weight on delivery.

c) A sale of scrap is recognized on the basis of delivery

d) Revenue grants are recognized over the periods in which they are spent to

match to the related costs.

e) Insurance claims are accounted during the year of settlement.



3. Fixed Assets

a) Fixed assets are started at cost less depreciation, capital work-in-progress

are recorded at historical cost.

b) Values of abandoned fixed assets and capital work-in-progress are charged

off in the year in which the same are identified as redundant.

c) Expenditure during the period of reduction for

expansion/modernization/mechanization of existing unit is capitalized on

successful completion of the concerned project.

d) Government grants received relating to capital expenditure are reduced

from the gross value of such expenditure.

e) Borrowing cost that directly attributable to the acquisition of an asset up to

the scheduled date of completion as per technical report are capitalized as

part of cost of that asset.

4. Depreciation

a) Depreciation on a fixed asset is provided on straight line method based as

contemplate under section 205(2)(b) of the companies act, 1956 read with

schedule 14 of companies act, 1956.

b) Additions to existing, asset are depreciated over the remaining useful life

of that asset.

5. Investments

a) Long term investments have been valued at acquisition cost. Current

investments are valued at the lower and fair market value on individual

asset basis.



6. Valuation of Inventories

A. Stores, Spare parts, loose tools

a) Store and spare parts purchased are valued at weighted average cost,

b) Spare parts/consumable manufactured is valued at cost.

c) Loose tools costs of which Rs.500 or less are charged off in the accounts

at the time of issue from stores. Loose tools whose value is more than

Rs.500 is charged off at the rate of 50% per year on reducing balance

method, till such time redundant value comes to Rs.500 and then charged

off in full.

B. Finished goods

Gold at lower cost and net realizable value [Mumbai bullion price for

standard gold as on 31st march less discount]

a) Silver of lower of average selling price for the year of closing market value.

b) Copper lower of average selling price for the year closing market value.

c) Work in progress lowers of estimated cost and net release value.

d) Stock of ore on surface: lower of cost and net estimated realized value.

e) Good in transit: At cost

f) Medicines canteen and stationary items are charged off as purchase since the

same are meant for immediate consumption and not for resale.

7. Deferred Revenue expenses

a) Expenses incurred on exploration, prospecting in the

deposits/Leases/Areas serving the existing units are treated as deferred

expenses and amortized during the first 5 years of operation which ever is

earlier.



b) Other miscellaneous expenses are amortized over period of 5 years.

c) Expenses towards voluntary retirement scheme is amortized over the

balance period of service of the employee not exceeding 5 years,

following the years of insurance.

d) Borrowing costs from the stipulated date of completion as per technical

report up to the date of commissioning of the project are treated as

deferred revenue expenses and are charged of over the period of 5 years,

from the following years of commissioning of the project.

8. Employee retirement benefits

a) Gratuity liability is covered by group gratuity policy administered by LIC

of India. Premium in respect of annual contribution is charged in the

accounts.

b) Privilege leave encashment is accounted on the basis of the amount paid

/payable/in respect of separated employees, in respect of other employees;

provision for leave encashment benefits is based on actual valuation.

c) Company’s contribution to provident fund has been made to an approved

fund/Provident fund authorities. The contribution is charged of to the

profit and loss account.

d) Company’s contribution to superannuation in the case of eligible officers

(based on percentage of basic pay and Dearness allowance is made to an

approved fund). Annual contribution is charged to profit and loss account.

e) Provision towards 25 years long service awards is made in the year of

eligibility.



9. Prepaid expenses

Expenses is excess of Rs.500 whereof benefits accrue in the subsequent year, are

treated as prepaid expenses.

10. Foreign Exchange transactions

a) Transactions in foreign currencies are recorded in the exchange rates

prevailing at the time of transactions, except in this case of forwarded

contract where transaction are recorded at forward contract rates.

b) Liability in respect of foreign currency transaction outstanding at the end

of the year not covered by forward exchange contract is updated at the

year end rates and the exchange difference adjusted to the profit and loss

account.

11. Deferred Taxes

Provision for current tax liability is made after taking into consideration benefits

under the provision of income tax act 1961. Deferred tax (net) resulting from timing

difference between book value and income tax values in accounted for at the effective tax

rate as on balance date.

12. Provision, Contingent liability and contingent assets

A provision is made based on reliable estimate when it is probable that an out

flow of resources, embodying economic benefits, will be required to settle an obligation.

Contingent liability, if material is disclosed by notes to accounts. Contingent assets are

not recognized or disclosed in the financial statement.



HGM Company Limited Balance Sheet as at 31-Mar-2009

Sources of fund 31.3.2009 31.3.2008

Sources of fund

Share holders fund

Reserves and surplus

29620371

2012941418

29620371

1477502110

2042561789 1507122481

Loan Funds

Secured loans

Unsecured loans

129475777

---

70146439

---

Deferred tax

Liability – Net 133995252 94707550

Total 2306032818 1671976470

Application of funds. 2009 2008

Fixed assets

Gross Block 1284364071 923691469

Less Depreciation 473396287 411238653

Net Block 810967784 512452816

Capital WIP 66934819 205074562

Investments 776748796 489506229

Current Assets loans

and advance

Inventories

Sundry debtors

Cash and bank

balance

Other current assets

496987672

623532

74159313

1607143

1231251278

395331930

---

74570539

1598316

813406901



Loans and advance

Total

1804628938 1284197686

Less Current liabilities

and provision

Current Liabilities

Provisions

Total

323143786

979500910

1302644696

177859135

715775456

893634591

Net Current Asset 501984242 391273095

Misc. Expenditure to

the extent not written

off/adjusted

Deferred revenue

expenditure

Total

149397177

2306032818

73669768

1671976470



HUMAN RESOURCE DEPARTMENT

Introduction:

Human Resource management is a management function that helps manger

recruit select, train and develops employees for organization. It is concerned with the

people dimensions in the organization. It is concerned with the people dimensions in the

organization. It is specialized field that attempts to develop programmes, policies and

activates to promote the satisfaction of both individual and organizational needs goals

and objectives.

It is concerned with the people dimensions in management. Since every

organization is made up of people acquiring their services developing their skills,

motivating them to higher levels of performance and ensuring that they continue to

maintain their commitment to the organization are essential to achieving organizational

objectives.

Human resource philosophy :

Hutti gold mines Company limited believes that people are greatest assts and have

the potential to grow and be creative with increased efficiency.

In turn, should demonstrate that no compromise can be made by debiting to

traditional respect for the individual and must provides support and encouragement by

creating opportunities and challenges with equity to.

“Make Hutti gold company a people’s Organization”



SELECTION PROCEDURE OF THE EMPLOYEES:

The company selects the employees required for the concerned jobs through the selection

procedure. The procedure is as follows:

1. Job analysis:

It refers to the study of job in terms of duties, responsibility risks and other factors

associated with each kind of job. It is the basis for the selecting the right candidate to the

right job. It is essential to finalize the job analysis, job description, job satisfaction and

employee’s satisfaction before proceeding to the next step.

2. Recruitment:

It refers to the process of searching for prospective employee and

stimulating then to apply for job to the company. Selection of right no kind of candidate

depends effective requirements.

3. Application form:

It is also known as application blank it is widely accepted technique for

securing information from the respective candidate. The company asks the application to

apply on paper giving particular about his name, date of birth, mailing address, education,

qualification, experience, etc.



Contents of application Form:

Personal background information

Education attainment

Work experience

Salary accepted

4. Tests:

The following are the tests conducted. They are as follows:

a) Aptitude test: This test conducted to known the ability if the

b) Candidate to learn to job, it giving adequate training candidate may be

having some specific aptitudes such as mechanical, clerical, managerial,

etc.

c) Personality Test: Personality is some total of mental moral and physical

trades are qualities. The test will help the experts to know the qualities like

emotions, reaction, mental maturity, self-confidence, optimist’s decisions

making, capacity, sociability, patients, intensive, honesty and integrity.

d) Medical Test: This test is conducted to assess the physical healthy

standards of the prospective employee. Beside medical test is conducted to

see that the candidate’s are not suffering from any infection diseases.

e) Employment Test: This test appears more suitable while selecting the

typist’s stenographer, computer operators, mechanical engineer’s,

electrical engineers etc. This test is intended to know the practical

knowledge and prophecy of the candidate in performing the job.



5. Final Interview:

The candidate’s who are successful in the above tests will be called for final

interview. Interview means face-to-face encounter with purpose recruitment committee

consists of some persons from the concerned department and from the human resources

department this expert goes on asking different topics. Based on the satisfactory answer

the candidates are final considered for the employment.

WELFARE:

Types of welfare activities:

a) Medical Facility:

The company has got a well-equipped hospital with 120 beds and Blood Bank

was established and inaugurated in the year 1999. Company has been treating the

employees and their dependents at free cost. The employees and their dependents

requiring special treatment are referred to place where medical facilities are available and

the cost incurred for such treatment was re-imbrued to the employees. Average of 800-

850 out patients were treated per day and average per month expenses towards medicines

was Rs. 7,45,240 (app) spent during the year.

b) Canteen facility :

The company runs its industrial Canteen; the welfare department supervises the

day to day work of the canteen. The break fast, lunch and dinner is also supplied at

subsidized rates at the respective departmental canteen. Average monthly sales Rs. 6.37

Lakhs. Average monthly Subsidy paid by the Company Rs. 5.68 Lakhs



c) Housing facility:

The Company has 2365 quarters. These quarters have been allotted to the eligible

Officers/ Staff/ Employees. Regular visits made to the colonies by the welfare Officers to

regulate the health and hygiene of the camp area. A new beautiful park was developed in

the Labor and Officers colony, for the use of officers, employees and their families.

d) Schools:

There are all together 18 Gov/ Private Schools in the camp and as well as

adjoining the campus, offering primary secondary and Pre –University education to the

children, children are instructed in different languages like Kannada, English, Telugu,

Tamil and Urdu and some of the children of the employees are also accustomed in

studying their own language. The total strength of children studying in their different

education institutes was 12409 during the year 2008

e) Co- operative store:

The co-operative store has 2456 members. The monthly average sale of the

society is 30 lakhs. It continues its services to the company’s employees. The Directors

for the society are chosen amongst the members once in 3 years.

f) HGML Institute:

It maintains a stadium, multi – Gymnastic equipment, circulation library and all

other out-door and in-door sports/games, materials for the benefits of employees and their

children. It also conducts many out-door and in-door tournaments.



g) Loan:

Employees Provident Fund loans were granted to employees following:

SL. No Category No of Employees Amount Rs.( Lakhs)

1. Sick 1860 262.20

2. Marriage 68 33.85

3. Education _ _

4. House Building Loan 436 189.49

Total 2364 485.54

h) Workers Education Class:

Workers Education classes are conducted under the auspicious of CENTRAL

BOARD WORKERS EDUCATION, to 30 workers unit level classes conducted from 14-

03-2003 to 12-04-2003. As industrial tour has been arranged from 2nd May 2003 to 12th

may, 2003.

i) Counseling:

The welfare officers have taken up the counseling programmed to help and guide the

employees who come across their personal, social and other problems. The counseling

programmed is taken up at the welfare department in attending their problems as

following cases:

Absenteeism

Family dispute

Family Planning

Indebtedness

Child care

Savings

Alcoholic

Health awareness

Transport



Based on the above facts the Welfare Officers made efforts in promoting awareness by

motivating & guiding to the employees who come to seek assistance from them. Family

counseling is done to the employee and their family members. In case of alcoholic

employees monthly side collection amount is collected from their salary and the same

amount paid to wife/dependents.

SAFETY:

There is a saying over here,

“Safety first, production must”

Safety of the employees, workers guests and whoever else presents in the

responsibility of the industry. JSW is legally and humanitarianly responsible for every

accident (reportable or non reportable) within the plant boundary.

Safety devices:

There are many safety accessories available for workers:

Helmets, Protective Glasses, Glass masks, Denim Jackets, Hand Gloves, Denim trousers,

safety shoes etc.

Depending on the work environment, aluminum jadels, safety belts, with hooks,

welding, masks, ear plugs, co monitors etc are some of the other safety equipments used.

Safety week celebration:

Safety week is celebrated every year.



MARKETING DEPARTMENT

INTRODUCTION

Marketing department is one of the important departments in HGML. They

provide door delivery after the agreement for gold purchase.

The present gold purchases are

M/S Suresh Jewelers

M/S Bangalore Refinery

M/S Précis Jewels

[Bombay bullion]

The Gold rate fixing on this committee

The board perused care fully the note circulated. Dr Subramanya desired to have

details of the procedure of sale which was explained. After the deliberations, the

following resolution was passed.

Resolved that approval of the Board be and in here by given for sale of Bullion at

1 % refinery discount based on the Mumbai Bullion Market price of standard gold of 99s

purity and silver of 999 purity as published in the Economic Times on the date of

delivery of bullion to M/s Bangalore Refinery (P) ltd, 40 kilograms; M/s précis precious

metal Co PVT ltd 10-15 kilograms and M/s Suresh Jewelers 10-15 kilograms per week

for the period of 3 years 1.4.2006 to 31.3.2009 Further resolved that action taken in the

sale of Bullion at a refinery discount of 1% from 1st April to 31st March 2009 be and the

some herby ratified and approved.



ENGINEERING DEPARTMENT

Engineering department is a department which deals with all most all supportive

engineering jobs like maintenance and repairs of existing machines, equipments and

buildings and installation, erection and commissioning of new machines equipments and

projects, transportation facilities for Mining Engineering and Metallurgical Engineering

departments and also provides engineering solutions for making arrangements for providing

fundamental amenities for the employees and their dependents like

Providing water for drinking and daily use.

Providing electrical facilities.

Making civil constructions.

Providing transportation facilities.

VARIOUS SECTIONS OF ENGINEERING DEPARTMENT.

Plant section.

U / G Engineering section.

Electrical section.

Project section.

Compressor section.

Transportation section.

Pipe & pump section.

General work shop.

Civil and Carpentry section



PLANT SECTION:

This section is a supportive section for the Gold production plant. That plant contains

the following sections

Crusher section

Grinding section

Cyanide section

Assay lab

Ventilation section

So all these sections have their own machinery for production of Gold like crusher

section have K Jaw crusher, Cone crusher, belt conveyors.

Grinding section have machine like Ball mills, pebble mills, concentrators, cyclone

concentrators, belt conveyors.

Cyanide sections have machines and equipments like thickeners, agitators, C I P,

furnaces, Carbon recharge kiln.

Assay lab has small machines like crushers, mills and furnaces.

Ventilation section have ventilation fans of various size for providing ventilation to the

under ground people.

Maintenance (Preventive, predictive, breakdown), repairs and erection, installation of

above said machinery and equipments is carried out by Plant Section.



UNDER GROUND ENGINEERING DEPARTMENT:

This IS engineering supportive section for mining engineering department. Mining

department has different shafts for trimming ore from different levels of each shaft for

that purpose we have different machinery & equipments like

Drilling equipments ● Locomotives

Air hoists ● Loaders

Rock breakers ● Conveyors

Crushers

Maintenance (Preventive, predictive, breakdown), repairs and erection, installation of

above said machinery and equipments is carried out by U / G Engineering Section.

COMPRESSOR SECTION:

One of the major source used for all most all mining processes like drilling of

holes ,loading the material ,hoisting and lowering of men and material to different

level and sub levels, diaphragm pump used for under ground mine dewatering

purposes is compressed air. This compressed air is produced by different types of

compressors like

1) Rotary (electrical) 3) Rotary (diesel operated)

2) Reciprocating (electrical) 4) Reciprocating (diesel operated)

And Electrical power generators (diesel operated) of different capacities, Maintenance

(Preventive, predictive, breakdown), repairs and erection, installation of above said

machinery and equipments is carried out by Compressor Section.



PIPE AND PUMP SECTION:

After production of compressed air supplying the same to the user end, supplying

the water to each and every working point, supplying sand slurry for sand stowing

purpose, providing water for employees for drinking and daily use is carried out by pipe

connections.

Installation of new pipe connections as per requirements repair and maintenance

of existing pipe lines is executed by pipe section.

One of the major problems in under ground mining is dewatering process this is

done by lifting the water from different levels by different capacity and type of pumps

Installation of new pumps as per requirements repair and maintenance of existing

pumps is executed by pump section.

All the machines, pumps and equipments of water purification unit are also

maintained and repaired by the same section.

ELECTRICAL SECTION:

As all of us know all most all thing are difficult without electrical power. Each

and every thing in our routine life is depend on the electrical power.

So in mining industry starting from lifting the material to making final billets of

gold all most all process are carried out by help of electrical prime movers. These prime

movers include DC and AC motors of different types and of different capacities which

helps. To run winders, conveyors, crushers, mills, thickeners, Agitators, electro winning

process, furnaces.

And other electrical equipments like transformers, generators, etc.

Installation, erection, maintenance (Preventive, predictive, breakdown), and repair of

electrical and electronic machineries and equipments is executed by this department.

Making lighting arrangements for industrial area and employee’s residential camp is

carried out by the same section.



CIVIL SECTION:

The main role of civil engineering is to take care of all most all civil works like

constructing foundations for industrial machinery, buildings for process plant; industrial

constructions, residential building for employees and other amenities like making

roads ,gutters, water tanks etc. This is a supportive section for all the sections.

This section has two sub sections

1. Building section

2. Carpentry section

PROJECT SECTION:

All huge metallic structures like roof structures for all industrial as well as

residential, any new metallic constructions like agitators CIP plants and installation of all

new machineries like mills ,crushers ,process plants etc are executed by project section.

GENERAL WORKSHOP:

This section is supportive section for all departments this section has fallowing

sub sections.

Machine shop

Fitting shop

Fabrication shop

Rubber foundry

Cast iron& Brass foundry



In the work shop all fabrication, machining, molding activities are been carried

out to cater requirements of U/G mining dept., metallurgy dept., and to all other

engineering sections.

TRANSPORT SECTION:

This section provide transportation facilities for all sections of all department like

Cars, buses, Jeeps, excavator, dozers, cranes, lifters, Tippers, Trucks etc

This section is having its own work shop where all maintenance & repairing

activities of above said vehicle & equipments are been carried out.

PURCHASE DEPARTMENT

Introduction:

The success or failure of any factory depends upon the cost of materials. This is

because material cost is a major part of the total cost. An efficient purchasing ensures

getting of materials from the right sources and at a right price. Thus purchasing is most

important function of materials management. In big organizations like Hutti Gold Mines

there is a separate purchasing department. The management entrusts all powers to this

department for purchase of all types of materials. This department is entrusted to one

responsible person. He is usually known as Purchase Manager or the Supply Manager or

the Chief Buyer.



Qualification of Purchase Manager:

The Purchase Manager should possess the following qualities: -

1. Good knowledge of industry.

2. Administrative and organizing ability.

3. Honesty and integrity.

4. Knowledge of contract of law.

5. Knowledge of economic principles of demand and supply.

6. Knowledge of government policies.

Functions of the Department:

The main function of the purchase department is to purchase the materials required by

various departments. Before purchasing the materials purchase officer has to study the

buying problems such as: -

Where to purchase

When to purchase



Whom to purchase

How much to purchase

At what price to purchase

To answer above questions purchase department has to

Perform the following functions: -

Receiving purchase requisitions or indents (when to purchase).

Determining the volume of materials to be ordered (how much to purchase).

Inviting tenders or Quotations from different suppliers (where to purchase)

Placing orders i.e. selecting suppliers (what to purchase) Receiving and inspecting

materials.

Checking and passing of bills for payments.

Documents of Purchase Department:

The purchase departments in the company keep some of documents: -

Purchase order proposal

Purchase enquiry

Purchase order

Tender applications



Purchasing Procedure:

In the HGML Company following procedure is followed in purchasing department:

1) RECEIVING PURCHASE REQUISITION:-

The first step in the purchase procedure is the receipt of the purchase requisition

for materials by the purchase department from the various departments. Request

for purchase of materials are made on a form known as ‘purchase requisition’. It

specifies what kind of material is required.

2) EXPLORIN THE SOURCE OF SUPPLY:-

The purchase manager is usually in contact with several sources of supplies of

different materials. If the materials are to be purchased in bulk, he invites

quotations from various suppliers in the form of a Tender. When tenders are

invited, then the lowest tender should be accepted by the purchase department by

considering other factors like quality, terms of payment, modes of delivery etc.

3) PLACING AN ORDER:-

After selecting the supplier who quoted most favorable quotations, the next step

to taken by the purchase manager is to place the order. The order must be made

on a printed form and must contain such information as number, date, address of

supplier, particulars of goods etc. This order form should be prepared in 4 copies.

The original copy should be sent to suppliers, second copy to the stores

department, third copy to the accounts department and last copy is retained by the

purchase department for its future reference.



4) RECEIPT AND INSPECTION:-

When the invoice is received from the concerned supplier, it will be compared

with the order form to ascertain whether the only ordered goods have been

supplied or not. Then these goods are physically inspected to ascertain whether

goods received tally with the invoice

5) ENTRIES IN THE BOOKS OF ACCOUNTS:-

After the goods received are closely checked and if found correct, the receiving

clerk prepares goods received not in three copies. Three copies along with goods

received will be sent to stores department which intern sends one copy to

purchase and account department. Purchase department will then forward the

invoice to the accounts departments for payment.



Problems and Solutions:

Problems:

The following are some problems that both stores department and purchase

department are facing. They are: -

The store is facing shortage of workers.

The transactions are transferred in writing and it takes long time also.

MRN is not raised soon after the stock is completed and which leads to shortage

of materials during the production.

Solutions:

As, I have seen that in the company especially in stores it faces problems as

mentioned above and for that solutions are as: -

The store should appoint workers by approaching the Management so as to

perform the works in smooth way.

For easy transfer of the transactions the store should be provided with computers

to make the entries daily so that it would be easy for future reference.

The user department should raise the MRN as soon the stock or material gets

finished and helps the store to keep the stock in the store.



MAIN STORE DEPARTMENT

Introduction

Store means a building constructed for preserving the materials. The term store is

a wide term and includes such as raw materials, components, maintenance of materials,

tools, patterns, work in progress, finished goods, and consumable stores.

The main stores will be responsible for keeping stock of material, which is need

by the user department of the company. The stores will maintain minimum stock in the

stores. As the company have its own techniques to maintain the stock level in the store.

The company issues the materials on the basis of FIFO method to the each department.

Functions of the stores:

Receiving good into stores after checking them with the contents of the goods

received note and inspection report.

Maintenance of proper record of materials received and issued to production.

Proper classification and codification of materials.

Maintain the store department neat and tidy.

Issue of materials only against authorized requisition.

Maintain stock level for each item of material.

Prevent unauthorized person from entering into the stores.

Receive back surplus materials returned.

Initiate purchase requisition for the replenishment of stocks.



STRUCTURE OF MAIN STORES

`

Other Staffs

1. Goods Clearing Clerk

2. Goods Returning Clerk

3. MRN Preparation

4. Claims Section


Dy. General Manager (Mat)

Senior Manager (Material)

Dy Manager (Material)

Store’s Officer -3

Ledger Clerks 7

Store Boys


Material Control Techniques:-

The Company follows all eight material control techniques. They are:

a) Fixation of Stock Levels

b) Determining Economic Order Quantity (E.O.Q)

c) Stock Turnover Ratio

d) ABC Analysis

e) Bin Card

f) Input output ratio

g) Issue of Material

h) Pricing of Materials

Documents of Stores:

The Main Stores as following Documents in order to perform its activities and the

following are documents of stores:

1. Purchase requisition.

a) Materials: Rose by main stores whenever required.

b) Special order item requisition: Raised by various user department

2. Purchase indent

3. Material receipt Note (MRN)

4. Stores indent - it contents 3 copies.

5. Bin card

6. Issue Check list – Summary Sheet

7. Gate Pass:

a) Materials gate pass

b) Returnable gate pass

8. QCC – User department



SWOT ANALYSIS

SWOT analysis is an analysis of STRENGTH, WEAKNESS, and

OPPORTUNITY AND THREATS of a company. This is used to analyze the company

environment will help each and every company to know the present situation of the

company.

STRENGTH:

This is one and only reputed Gold Extraction Company in India

It has been producing the products as per the standard specified by the

Government of Karnataka.

The work environment is full of excitement, creativity, and innovative

atmosphere.

All the departments are computerized.

Quality of the ore and products.

Extraction process goes on 24/7

WEAKNESS:

Modern machine and equipment are not installed in the company

Absenteeism is the main problem in the company.

Huge sound and air pollution in the production department

One hour stoppage in the production process would lead to accrued loss of

2,18,400

Transportation costs are high.



OPPORTUNITY:

Company is having the excellent growth opportunity because of plants in different

location.

Company is having the good hold in the market that helps to earn more profit

The capacity of the plant is in the increasing direction.

It lies in the vicinity of large potential and unexplored market of Southern India.

THREATS:

There is no closer competition to the extraction of Gold but the liberalized rate to

import the gold is one of the problems from domestic companies.

Gold is non abundant resources which may not be available in future if we

continue to extract with the present rate.

Huge power consumes in extraction process and power failure.

Foreign currency fluctuation.



FINDIDINGS AND SUGGESTIONS

FINDINGS:

The Company is undertaken by Government of Karnataka.

Employee’s co-ordination with the staff was found to be good..

Working atmosphere of organization is very good.

The employees are getting attractive bonus, salary, wages and other benefits.

There is high concentration toward the environment, health, and safety measures.

The company providing good medical facility to employees.

There is lack of good incentives schemes.

There is good maintenance of lighting, ventilation, and dust free environment.

The company ensures utmost safety while entering into mining department by

providing safety gear to all the employees.



SUGGESTIONS:

The worker should be motivated for continuous presence through counseling

The Manager Executives and other staff of the company should be sent to attend

seminars, Conferences and workshops to enhance their skills and update knowledge.

Training should be given keeping in view of changing trend in human resource

management and production technology.

The company should take severe actions to reduce the absenteeism.

Good intensive should be given for the workers who take minimum number of holidays.

Company should recruit skilled labours to maintain productivity.

The company has to extend transport facilities to the employees staying outside

the Hutti gold mines.



CONCLUSION

It is necessary to bring forward clearly that Indian economy as well as its Gold industry

during the past 50 years of its independence marched forward steadily with vocational ups

and downs. In a large country like India with domestic set up, a continuous high growth rate

many not to be always feasible. More over, the market economy also brings uncertainties.

However Gold Company showing good trend during the past 10 years. Thorough the study, I

came to know the production process of HGML’s details reading HR coils, HR plates and

sheets and it send applications.

It is necessary to say that, through the study, I came have gained a good exposure on

organization and its operational areas in the HGML AND THE STREGTH AND

WEAKNESSES OF INDIAN Gold industry.

India is endowed rich of ore and other fluxes. It should be possible of the Gold making

companies in India to lower their variable costs through,

Implementation of cost effective technology

Improvement in the process efficiencies.

Reducing cost of services by choosing cheaper transportation made like coastal

movements through water ways.



Bibliography

1) Company Magazines and Journals.

2) Company Annual Reports.

3) Production & Operations Management: Everett E.Adam, Jr. and Ronald J.

Ebert.

4) Financial Management:Prassanna Chandra(6th Edition).

5) Business Research Methods:Donald R.Cooper and Pamela S. Schindler (9 th

Edition)

Websites

www.hgml.org

www.google.com
