Sector Overview

Nepal lies in the centre of the 2,500 km Himalayan belt, which has favourable geography for various minerals (metallic, non-metallic, and fuel). As many as 63 minerals have been identified in Nepal. In 2010/11, 80 mines and quarries for 12 different minerals were in operation. Of these, 29 are limestone quarries and 6 gem mines. In 2011, mines and mineral-based industries contributed 2.4% to Nepal’s GDP.

Nepal has an abundance of minerals used in industrial and construction works including:

  • Limestone (most abundant)
  • Coal
  • Talc 
  • Clay red
  • Granite and marble (identified, but not extensively explored) 
  • Coal (with mines in Dang, Salyan, Rokpa and Palpa districts)
  • Gold (alluvial gold was exploited in the past and there is potential for primary gold mining)
  • Semi-precious and precious stones (tourmaline, aquamarine, ruby and sapphire)

The Department of Mines and Geology is engaged in the exploration and evaluation of mineral resources in Nepal and compiles and publishes consolidated information on the situation and potentialities of different minerals in the country. As per the Nepal Mines and Minerals Act 1986, the classification of minerals is done by type and importance:

  • Type: Metallic/non metallic/fuels/thermal springs
  • Importance: Very important/important/valuable/ordinary

The Department of Geology and Mines has discovered 1.07 billion tonnes of limestone deposits, of which 540 million tonnes are proven, 110 million tonnes are semi-proven, and 420 million tonnes are feasible deposits. These have been discovered in different districts including Udayapur, Dhankuta, Sindhuli, Makwanpur, Lalitpur, Dhading, Syangja, Arghakhachi, Sukhet, Dang, Salyan, Baitadi and Palpa.

As of January 2014, there are 44 cement plants in Nepal, of which only 12 have their own clinker production units. In the last two fiscal years, Nepal has imported cement worth approximately NPR 16 billion (USD 160 million). The cement industry has experienced a sudden surge in demand due to the construction taking place. It is estimated that Nepal imports about 15–20% of the total cement consumed. The total FDI in this sector till date is approximately NPR 4.1 billion (USD 40 million).



Fuel minerals

  • In recent times, the western part of Nepal has witnessed gas and oil seepage, confirming the presence of oil and natural gas in Nepal.
  • About 10 petroleum and natural gas exploration sites have been identified.
  • Some petroleum companies have already sought licences. 

Metallic minerals

  • Nepal has more than 20 million metric tonnes of ore reserves in more than 80 locations.
  • Copper occurs in Nepal in more than 107 locations.

Industrial minerals

  • Recent studies have shown that Nepal may have 2.5 billion metric tonnes of cement grade limestone. 
  • Nepal has an estimated potential of 5 billion metric tonnes of dolomite and 180 million metric tonnes of high grade magnetite.
  • IBN has given foreign direct investment approval to 2 international cement companies to establish cement plants in Nepal. 
Source: Government of Nepal, Investment Board

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