Mines and Minerals


  • Sector Overview

  • Opportunities

  • Laws and Regulations

  • Investment Incentives

  • Mines and Minerals Sector Profile PDF

Sector Overview

Nepal lies in the center of the 2,500 km Himalayan belt, which has favorable geography for various mines and minerals. With almost 83% of its territory in mountainous regions, Nepal is a developing country with vast natural resources including water, minerals, forests, and a myriad of agricultural products and medicinal and aromatic plans. Nepal has an abundance of minerals required for industry and construction, including the most abundant, limestone, coal, talc, red clay, granite, marble, coal, gold, and precious and semi-precious stones (tourmaline, aquamarine, ruby and sapphire).

Similarly, Nepal is also endowed with other construction minerals including construction aggregates, sand, gravel, dimension stone, decorative stones, paving stones and roofing slates. To date, 63 minerals have been identified in Nepal. In 2015/16, 85 mines and quarries for 15 different minerals were in operation. Of these, 31 are limestone quarries and 7 are gem mines.5 Currently, over 250 private investors have shown interest and acquired 400 prospecting licenses to explore 24 mineral commodities and 222 mining licenses to exploit 15 mineral commodities (except river gravel and sand mines). There are over 31 limestone quarries from which limestone is supplied to some cement industries.

The GoN has explored the feasibility of mining (metal and non-metal) minerals in Nepal. It has also solicited the interest of national and international companies and investors to invest in mining opportunities. The GoN opened up the mining sector to foreign direct investment in 1999, upon the promulgation that year of the Mines and Minerals Act. As a result, private investment, both domestic and foreign, has been authorized for the exploration and exploitation of iron ore, copper, manganese, lead, chrome ore, zinc, sulphur, molybdenum, gold, tungsten ore, diamond and other precious stones, nickel, and metals in the platinum group. The GoN’s policies related to FDI in the mining sector has been liberalized in recent years and as a result, several foreign companies have begun to invest in Nepal. The majority of investors come from India and China, the USA, Canada, Australia, the UK and South Africa. Most interest has been shown in base metals, diamonds, mineral sands and gold.

Recent Updates

  • A large deposit of uranium has been discovered in Upper Mustang region of Nepal. Preliminary research suggests that the deposit is spread over an area 10 km long and 3 km wide could be of highest grade. These findings have also been confirmed by the International Atomic Energy Agency.
  • In recent times, the western part of Nepal has experienced the seepage of gas and oil, confirming the presence of oil and natural gas in Nepal. Approximately 10 petroleum and natural gas exploration sites have been identified in Mustang and Kathmandu regions (Tokha, Teku, Imadol).
  • The GoN has granted Dangote Cement from Nigeria, Hongshi and Huaxin from China and Reliance Cement from India approvals to invest in Nepal. Combined, their FDI amounts to US$1.45 bn and their proposed output stands at 22,000t/day.7

Institutional Arrangement
Policy Level

  • Ministry of Industry
  • Ministry of Commerce and Supplies
  • Ministry of Forest and Soil Conservation
  • Ministry of Science, Technology and Environment

Regulatory and Implementation Level

  • Department of Mines and Minerals
  • Department of Forest


Mines and Minerals Sector Divisions
Department of Mines and Geology is engaged in the exploration, excavation and evaluation of mineral resources in Nepal. Department of Mines and Geology has divided the industry into six sub-sectors as follows:

Metallic Minerals Non-Metallic Minerals Fuels Minerals Gemstones Decorative and Dimension stones Construction Minerals
  • Iron
  • Copper
  • Zinc and Lead
  • Cobalt
  • Nickel
  • Gold
  • Silver
  • Tin
  • Limestone
  • Phosphorite
  • Magnesite
  • Coal
  • Petroleum
  • Natural Gas
  • Methane Gas
  • Hot Springs
  • Tourmaline
  • Beryl/Aquamarine
  • Garnets
  • Kyanites
  • Rock crystals
  • Marbles
  • Granites
  • Quartzite’s
  • Slate
  • Rocks
  • Basalt
  • Colored sandstone
  • Phyllite,
  • Slates, Flaggy quartzite and schist

Metallic minerals, including iron, copper, zinc, lead, gold, platinum, silver and tin, are generally extracted from ore minerals. A numbers of metallic ore minerals are known to be found in various regions of Nepal.
Non-metallic minerals such as magnesite, phosphorite, talc, limestone, dolomite, quartz, mica, clay, silica sand, gemstones, decorative and dimension stones, construction materials etc. are found throughout the country.
Fuel minerals are naturally occurring carbon or hydrocarbon fuels such as petroleum, peat and natural gas formed by decomposition of organisms.
Gemstones are pieces of minerals (or other rock or organic material) that can be converted to jewellery or other accessories. Certain gemstones such as tourmaline, Beryl/Aquamarine, Garnets, Kyanites and Rock crystals are available in Nepal.
Decorative and dimensions stones are a variety of indigenous, metamorphic, and sedimentary rocks including Marbles, Granites and Quartzite that are available in Nepal.
Construction minerals refers to Rocks, basalt, colored sandstone, phyllite, slates, flaggy quartzite and schist are used for roofing, paving and flooring.


Metallic minerals are the source of metals including iron, aluminum, copper, zinc, manganese, lead, chrome, platinum and others. Demand for new metals derived from ore deposits is increasing, largely due to reconstruction works. Some of metallic ore found in Nepal are discussed below:

Nepal is known to have 100.5 million tons of iron ore.

S.N. Headings Information
1 Main Iron Ore Deposits Phulchoki (Lalitpur), Thoshe (Ramechhap), Labdi Khola (Tanahun), Jirbang (Chitwan), Phalam Khani (Parbat)
2 Prospects availability Baitadi, Bajhang, Jajarkot, Rolpa, Surkhet, Myagdi, Baglung, Parbat, Chitwan, Ramechhap, Taplejung
3 Licensing Details 13 prospecting licenses and 3 mining licenses for iron to the private/ public companies in FY 2015/16.


The demand for copper has increased greatly in recent years. Common copper ores found in Nepal include chalcopyrite, malachite, azurite, covellite, cuprite, bornite, and chalcocite. Copper ore occurrences/ prospects/deposits are known from more than 107 localities in the country.

S.N. Headings Information
1 Main Copper Ore Deposits Darchula, Bajhang, Bajura, Parbat, Baglung, Myagdi, Gulmi, Tanahun, Gorkha, Makwanpur, Kavre, Ramechhap, Okhaldhunga, Dhankuta, Solukhumbu, Ilam, Taplejung, Gyazi (Gorkha), Okharbot (Myagdi), Wapsa (Solukhumbu)
2 Prospects availability Kalitar (Makwanpur), Dhusa (Dhadhing), Wapsa (Solukhumbu), Bamangaon (Dadeldhura), Khandeshori/ Marma (Darchula), Kurule
(Udayapur), Bhut Khola (Tanahun), Pandav Khani (Baglung), Baise Khani (Myagdi), Chhirling Khola (Bhojpur), Janter Khani (Okhaldhunga)
3 Quantity and quality Mines in Gyazi (Gorkha), Okharbot (Myagdi) and Wapsa (Solukhumbu), are able to produce 20 to 50 mt finished copper every year
4 Licensing Details 14 prospecting licenses for copper exploration have been issued by DMG until 2015/16


Zinc and Lead
Zinc and Lead deposits are found in more than 54 localities throughout Nepal. Ganesh Himal Zinc - Lead deposit (Lari and Suple) has proved to be an economic resource, and extraction works are currently under way.

S.N. Headings Information
1 Main Zinc and Lead ore Deposits Ganesh Himal area (Rasuwa), Phakuwa (Sankhuwasabha), Labang-Khairang (Makwanpur), Pangum (Solukhumbu), Salimar valley
Mugu/Humla), Daha Gulzar (Darchula), Phulchoki (Lalitpur), Sisha Khani and Kandebas (Baglung), Dhuwakot (Parbat),
Barghare (Makwanpur) and Khola Khani (Taplejung).
2 Quantity and quality 2.3 million tons of zinc and lead combined of commercial quality deposits are recorded (Chakrabarti 2003)
3 Licensing Details 4 exploration licenses for lead and zinc have been issued by DMG


Recently a large deposit of uranium has been found in the Upper Mustang region of Nepal. The demand for Uranium is growing for abundant source of concentrated energy. Since extracting uranium and assessing its quality is extremely costly and technically challenging, Nepal will require external support and technical knowhow for uranium extraction and proper use.

S.N. Headings Information
1 Main Uranium Deposits Thumki, Jagat, Panchmane, Gagalphedi and Chunikhel in Shivapuri area in Kathmandu, Tinbhangale, Chandi Khola and Chiruwa Khola (Makwanpur); Buka Khola (Sindhuli); Mardar Khola and Panpa Khola (Chitwan); Jamari Gad, Bangabagar, Baggoth, Gorang (Baitadi);
and traces in different section of Chamliya River (Darchula) and Mustang
2 Quantity and quality Uranium deposits about 10 km in length and 3 km in width in Lomanthang of very high quality.
3 Licensing Details No any Licenses issued yet by DMG


Other Metallic Minerals

S.N. Headings Information
1 Cobalt Cobalt ores are located in Netadarling & Tamghas (Gulmi), Samarbhamar (Arghakhanchi), Lamadanda (Dhadhing), Nangre (Kavre), Bhorle (Ramechhap) and Bauli Gad (Bajhang).
2 Nickel Nickel deposits are found in Bamangaon (Dadeldhura), Bering Khola (Ilam), Bauligad (Bajhang), Khopre Khani (Sindhuli) and old
workings from Nangre, Nigre and Bhorle (Ramechhap) area.
3 Gold Gold can be found in river gravel/ sediments deposited by the rivers including Mahakali, Chameliya, Jamari Gad, Seti, Karnali,
Bheri, Rapti, Lungri Khola & Phagum Khola (Rolpa), Kaligandaki, Myagdi Khola, Modi, Madi, Marsyangdi, Trishuli, Budhigandaki,
and Sunkoshi.
DMG has issued 45 prospecting licenses for gold till date.
4 Silver Silver availability is recorded in Ganesh Himal (Rasuwa), Baraghare (Makwanpur), and Bering Khola (Ilam). It is mainly used to
make ornaments, jewelry, coins, handicrafts, utensils, dental appliances, and in many other purposes.
5 Tin Tin is found in Meddi and Ganera (Dadeldhura) and Mandu Khola area (Makwanpur). It is used in making brass and bronze alloys,
coating, lining, plating the food containers, in chemicals etc.

In addition to the above described metallic mines, several other metallic ores including Tungsten, Bismuth, Arsenic, Cadmium, Chromium, Mercury, and Titanium are also found in various parts of Nepal. Further investigations will be required in order to know their exact status and economic potential.


A number of non-metallic minerals like magnesite, phosphorite, talc, limestone, dolomite, quartz, mica, clay, silica sand, gemstones, decorative and dimension stones, construction materials etc. are known to exist in their natural forms in Nepal. Some of the explored non-metallic ores are discussed below:

Due to Nepal’s vast quantities of limestone, a number of cement companies employ Nepali as inputs. Other cement plants are under construction and yet others are in the pipeline. The demand for cement, driven by infrastructure development works and reconstruction is ever increasing in Nepal.

S.N. Headings Information
1 Main Limestone Ore Deposits Udaypur, Dhankuta, Sindhuli, Makwanpur, Lalitpur, Dhanding, Syangja, Arghakhanchi, Surkhet, Dang, Salyan, Baitadi and Palpa.
2 Quantity and quality 1.25 billion metric tons of best cement grade limestone deposits. 540 million tons of limestone deposits has been proven, while
that of 110 million tons has been semi-proven, and there are possibilities of having an additional 420 million tons.
3 Licensing Details According to DMG record (FY 2015/16) 44 mining licenses and 172 prospecting licenses of limestone have been issued to the
private sector.


Other Non-Metallic Ores

S.N. Headings Information
1 Dolomite From geological mapping over 5 billion tons (possible) of dolomite occur mainly in Dhankuta, Khotang, Udayapur, Sindhuli,
Dolakha, Kavre, Kathmandu, Makwanpur, Dhadhing, Syangja, Palpa, Baglung, Gulmi, Arghakhanchi, Dang, Pyuthan, Salyan,
Rolpa, Rukum, Jajarkot, Surkhet, Dailekh, Jumla, Achham, Doti, Bajhang, Bajura, Baitadi and Darchula districts. It is yet to be
explored in detail thus their grade and
quality are still unknown. DMG has issued 10 prospecting licenses for dolomite.
2 Phosphorite Its availability mainly recorded in Dhik Gad, Junkuna, Morgaon, Sanagaon and Dhaubisaune areas in Baitadi while also in Tarugad,
Juilgad, Goichan - Kandechaur area in Bajhang and further east to Bajura.
3 Magnesite 180 million tons (66 million tons of high grade, MgO content 88 to 96% loss free basis) of magnesite deposit in Kharidhunga
(one of the biggest and best quality magnesite in south Asia), Dolakha; 20 million tons of mediums to low-grade magnesite deposit
in Kampughat in Udayapur district; and few small size magnesite occurrences from Palpa, Baitadi and Dolakha have been identified.
DMG has issued 1 mining licenses for magnesite

Occurrences of other non-metallic ores such as Talc, Mica, Ceramic clay/ Red clay, Silica sand, Salt: Brine water, Barites, Calcite and Diatomite have also been reported from different parts of Nepal.



A number of fuel minerals are believed to exist in different parts of Nepal, only the important ones are briefly described.

Petroleum and Natural Gas
The GoN has identified exploration for petroleum products as a priority. Western Nepal has witnessed gas and oil seepage, confirming the presence of oil and natural gas in Nepal. DMG/ Petroleum Exploration Promotion Project (PEPP) has identified 10 prospective blocks in the southern parts of the country.

S.N. Headings Information
1 Main Petroleum and Gas Deposits In a stretch of 14km in Padukasthan, Sirsathan and Navisthan area in Dailekh and Muktinath (Mustang).
2 Quantity and quality Not available
3 Extraction Period 35 years
4 Licensing Details Global tender
5 Exploration Period 4 years


Methane Gas
For many years the Kathmandu valley has been known to have methane gas deposits. DMG has invited potential investors to develop gas wells. Feasibility studies have confirmed that the gas can be used for industrial and household purpose and the reserve is sufficient to supply gas to 21,000 families for about 30 years.

S.N. Headings Information
1 Main Petroleum and Gas Deposits 26 km2 area in Kathmandu valley by exploration drilling of over 14 drill holes up to 570 m depth
2 Quantity and quality 316 million cubic meter methane gas deposit. Its average calorific value is 7200 kcal/m3
3 Extraction Period Not available
4 Licensing Details Global tender
5 Exploration Period 4 years

Other fuels minerals including coal, hot springs and radioactive minerals have also reported in many parts of Nepal. The major findings of coal have been reported in Dang, Salyan, Rolpa and Palpa districts. Hot springs are confined to the Main Central Thrust (MCT) zone in Mahakali, Karnali, Tila, Kaligandaki, Myagdi Khola, Marsyangdi, Trishuli, Bhotekoshi Rivers, Kodari and Surai Khola.


Hot Springs
Although studies are extremely limited, there are number of natural hot water springs scattered throughout Nepal’s mountain region. According to the mineralogists’ estimates, 50 hot water springs in the land belt stretching between the Himalayan and mountain regions. A list of natural hot springs is located in various parts of Nepal specifically, Sankhuwasabha, Rasuwa, Myagdi, Mustang, Manang, Tanahu, Bajhang, Jumla, and Darchula. Hot springs of Nepal often have very high mineral content. These are often popular tourist destinations and locations for rehabilitation clinics.


Semiprecious stones including tourmaline, aquamarine/beryl, garnet, kyanite, amethyst, citrine, smoky quartz (quartz crystals); and precious stones like ruby, sapphire etc. are believed to exist in various regions of Nepal. There are a half dozen large gem stone firms in Nepal dealing with gem dealing with local stones, some of which are described below.

Tourmaline is a semi-precious mineral stone that is well known for its ability to detoxify the human body. It is one of only a handful of minerals that have the ability to emit negative ions and far-infrared rays. Five distinct types of tourmaline are available in Hyakule and Phakuwa (Sankhuwasabha). Small-scale mines of aquamarine, beryl, tourmalines are in operation in those places. Two tourmaline mines are in operation in Daha area in Jajarkot and six mines are under development. 15 prospecting licenses and 13 mining licenses for tourmaline have been issued by DMG .18 Beryl/ Aquamarine Aquamarine is the most popular light-blue gemstone, and is extensively used in jewelry. Hambergite, danburite, and ijolite are important gemstone varieties found in Nepal. In Taplejung beryl and aquamarine mines are in operation. Beryl is also found in Jajarkot; Kathmandu; and Sindhupalchok.

Garnet, which falls into the group of rock-forming minerals, shares a common crystal structure. Garnets are recorded from strongly tectonized lenses and pods of chlorite-biotitic-garnet schist within high-grade metamorphic rock sequence mainly in the Higher Himalayan region. Deep red or red colored almandine, hessonite and pyrite garnet are mined mainly in Sankhuwasabha and Taplejung districts. More than six small-scale garnet mines were in operation since last few decades. 3 prospecting licenses have been issued by DMG and all the mines are still in their initial phases of operation.

Kyanite is a typically blue silicate mineral, commonly found in aluminum- rich metamorphic pegmatites and sedimentary rock. It is mainly available in Dolakha, Sankhuwasabha, Taplejung, Rasuwa, Dhadhing Jajarkot and Achham districts. Four small-scale Kyanites mines are in operation in Daha and Suneri in Jajarkot and Barah of Aachham districts and 4 mines are under development stage. DMG has issued 15 prospecting licenses and 4 mining licenses for Kyanites .

Quartz Crystal (Rock Crystal)
Quartz is one of the most common stones available in Nepal. It is the component of variety of rocks and comes in an extensive range of colors and varieties. Two small-scale quartz crystals mines are in operation from pegmatites in Khejemi/ Sirku (Taplejung) and Raluka (Nuwakot). Quartz crystals are also known from different parts of Jajarkot, Dailekh, Dhadhing, Rasuwa, Nuwakot, Sakhuwasabha, Ilam and Taplejung districts. Two mining licenses and 15 prospecting licenses have been issued by DMG.



A number of decorative and dimension stones including marble, granite, quartzite’s and slate are known to exist in various parts of the country. Some of the important ones which have already been explored described below.

S.N. Headings Information
1 Marble Its availability has been recorded in Lalitpur, Dhadhing, and Makwanpur. To date, three mining licenses and three prospecting
licenses have been issued by DMG for marble. Godavari Marbles, one of the major marble industries whose annual production
capacity is aproximately 80,000m2 produces polished marble slabs and aggregate as bi-products.
2 Granite Various types of granite exist in Makwanpur (Palung and Ipa), Sindhuli, Udaypur, Dadeldhura in the Lesser Himalaya. DMG has
done some evaluation work of Palung granite. Only 2 prospecting licenses for granite have been issued by DMG.
3 Quartzite Quartzite is found in Taplejung, Ilam, Dhankuta, Ramechhap, Sindhupalchok, Makwanpur, Dhadhing, Tanahun, Kaski, some other
districts. It is mainly used for dimension stones, flagstones for paving purposes, and in construction. 34 prospecting licenses and
7 mining license have issued by DMG to date
4 Slate Slate is extensively mined in different parts of Dhankuta, Sindhupalchok, Ramechhap, Nuwakot, Sindhupalchok, Dhadhing,
Tanahun, Baglung, Syangja, Palpa, Parbat, Jajarkot, Achham, Doti, Dadeldhura, Baitadi, Bajhang, Bajura and many other districts.
It is mainly used as roofing and pavement material.
5 Exploration Period 4 years



Stones in the form of river boulders, gravel, roofing slate, paving stones, and building block stone, marble and sand are the largest visible resources which can be found throughout the country. Construction minerals occur in two forms.

River boulders and Gravel
These are important resources in Nepal and are found in the rivers of Siwalik and Terai Belts. Preliminary evaluation of these resources has been completed. In many rivers, boulders are minable and can be exported.

Natural bedrock deposits
Natural bedrock deposits in the form of limestone, dolomite, granite, augen gneiss, slate, quartzite, etc. occur quite extensively in various rock groups of Lesser Himalaya. There are several quarries operating in the Kathmandu valley and Pokhara in which these deposits are the primary source of building materials for houses and other constructions.

Laws and Regulations

The following legislation governs mineral exploration and mining:
1. Mines and Minerals Act,1985
2. Mines and Minerals Rules,1999
3. Nepal Petroleum Act,1983
4. Petroleum Exploration Regulation,1984
5. Environment Protection Act,1997
6. Forest Act,1993
No mining activities can lawfully occur in the absence of a grant of a mining license and environmental clearance from the relevant GoN agency. The government issues two types of licenses related to mining activities, and they are described below.

Prospecting License
A prospecting license is required for all exploration activities in Nepal. A prospecting license allows the license holder to conduct exploration in an area not less than 0.25 km2 and not more than 250 km2 for an initial exploration period of 2 to 4 years and can be extended for up to 2 years. Exploration activities should be completed within 2 years for ordinary nonmetallic minerals and 4 years for metallic and valuable nonmetallic minerals. This type of license is categorized by the value of mineral that is being explored. Based on their market values, minerals are classified into 3 categories.

Category of Minerals

Very Precious Minerals
Gold, Uranium, Lyatinum, Thorium, Diamond, Ruby, Sapphire, Emerland, Corundum
Precious and Valuable Minerals
Zinc, Silver, Lead, Cobalt, Tin, Tungsten, Niobium, Tantalum, Chromium, Titanium, Topaz ,Tourmaline, Beryl, Magnetite, Talc, Limestone, Phosphate, Crystal Quartz, Dolomite, Graphite, Gypsum, Copper, Molybdenum, Vyanadium, Aquamarine, Garnet, Feldspar, Shaligram (Ammonite), Nickel, Beryllium, Bismut, Kainite, Natural (Biogenic) Gas, Calcite, Other fossils
General Minerals
Aluminum, Iron, Salt, Industrial Soil, Ordinary Soil, Fire Clay, Kaolin, Coal, Peat, Granite, Snide, Amphibolites, Abharkh, General Construction Stone, Sand, gravel and slate, Decorative stone, Orche, Silica Sand, Marble, Quartzite, Other minerals which are not classified as Very precious and Precious and Valuable minerals

Mining License
A mining license, issued by the DMG, is required to conduct any excavation activities in the county. This license allows the license holder to conduct mineral exploitation works in an area not less than 0.25 km2 and not more than 25 km2 for an initial period of 10 to 30 years depending on the level of mineral work and can be extended by up to 10 years. A mining license can also be issued to any eligible person for those mineral deposits identified by the exploration activity of DMG. In that case, the present value of the direct expenses incurred by the department in the exploration of the project can be valued and converted into the share or they can be recovered from the qualified applicant as the Government desires to do so. This type of license comprises of four categories, related to the scale of the operation. The fees and deposit amount for the acquisition of a license depends upon the category on which the license falls.

In the case of cement grade limestone, the initial period for a very small scale and small scale is fifteen years and twenty years, respectively, and can be extended by the DMG.

Category of Licenses Issued

S.N Category Years of Operation
1 Very Small Scale 10 Years
2 Small Scale 15 Years
3 Medium Scale 20 Years
4 Large Scale 30 Years



Investment Incentives

Income Tax

  • Applicable tax rate of 20%
  • In case of special industry if provides direct employment to at least 100 Nepalese national during a whole year, the effective tax rate shall be 70% of applicable tax rate.
  • There shall be exemption of dividend tax in case of special industry, industry based in agriculture and tourism sector capitalizes its profit (issues bonus shares) for the purpose of expansion of capacity of industry
  • Special industry with capital of NRs. 1billion and providing direct employment to more than 500 persons can enjoy 100% exemption for first five years from the date of operation of business and 50% concession for next 3 years
  • Special industries established in least developed, underdeveloped and undeveloped regions applicable tax rate shall be 10%, 20% and 30% of normal tax rate for first 10 years respectively.
  • Industries related to survey and extraction of petroleum and natural gases commencing commercial operation from Chaitra 2075 (April 2018) shall be provided with tax holiday for 1st 7 years and 50% exemption for the next 3 years.
  • Losses can be carried forward up to 12 years instead of 7 years for petroleum extracting industries.
  • 15% exemption for special industries listed in stock exchange.
  • Export income tax rate: 20%

Mines and Minerals Sector Profile PDF