Why Andhra Pradesh's Massive Gold Reserves Could Make It India's Largest Supplier
Andhra Pradesh is on track to become India's top gold supplier, led by a project in Jonnagiri estimated to hold 50 tonnes of reserves. Commercial production has begun, and CM N. Chandrababu Naidu will launch the project this month. Officials noted that declining recovery rates make gold extraction highly capital-intensive.
Andhra Pradesh is on track to become India’s largest domestic supplier of gold in the coming years, driven by major mineral discoveries in the Kurnool district. Mukesh Kumar Meena, the Principal Secretary for Mines and Geology, announced that the state’s mineral reserves are projected to significantly boost national production, which has historically faced severe domestic supply constraints. Chief Minister N. Chandrababu Naidu is scheduled to officially inaugurate the state's flagship mining operation later this month. The cornerstone of this development is Jonnagiri village in Kurnool, which alone is estimated to hold nearly 50 tonnes of gold reserves.
"Our estimate is that 50 tonnes of gold are available in Jonnagiri itself. So, we are confident that after a few years, we (Andhra Pradesh) will become the highest supplier of gold for the country," Meena told PTI during a press conference. Gold Rate Today, June 20, 2026: Check 22K and 24K Gold Prices in Delhi, Mumbai, Chennai and Other Cities.
Phased Exploration of the Jonnagiri Site
Commercial-scale gold production has already commenced at the Jonnagiri site. Approximately a decade ago, the state government allocated 1,500 acres of land for mining operations in the village. However, exploration and extraction activities have been executed in phases. To date, exploration teams have surveyed only about 500 acres of the allotted tract, confirming the presence of up to 13 tonnes of gold in that quadrant. Geological surveying for the remaining 1,000 acres is scheduled to begin in due course. Authorities project that once the entire allotted area is fully explored, the total verified reserves at Jonnagiri will reach the estimated 50-tonne mark.
Private Partnership and Capital Requirements
Because gold extraction is a highly capital-intensive industry requiring specialised technical expertise, the Andhra Pradesh government has partnered with private operators. The mining rights were awarded through a competitive public tendering process to ensure efficient infrastructure development and modern processing. Beyond the flagship operations at Jonnagiri, the state has mapped out and identified four additional prospective gold mining blocks. These locations include Ramagiri, Javvakula, and Chigurukunta-Bisnatam, which are slated for future exploration and leasing campaigns. Andhra Pradesh: 4 Killed as Heavy Rains and Strong Winds Lash State, Power Disruptions Reported Across Multiple Districts.
Shift in Global and Local Recovery Rates of Gold
Meena also highlighted a steep decline in the viability and volume of global gold recovery rates. Historically, processing a single tonne of mined material yielded an average of three grams of refined gold. Today, due to depleting high-grade ore, that recovery rate has dropped to approximately one gram of gold per tonne of mined material. The operational threshold for gold mining remains highly sensitive to these extraction metrics. Meena noted that under modern economic constraints, processing and extraction operations quickly become financially unviable if the recovery rate falls below 0.8 grams of gold per tonne of material.
(The above story first appeared on LatestLY on Jun 20, 2026 04:59 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).
