(IDEX Online News) – India will either auction a diamond project that Rio Tinto decided to abandon or allocate it to a state firm, the country’s Mines Minister said.

He stressed that the administration would move quickly to tap the Bunder deposit which is about 500 km (300 miles) southeast of New Delhi.

Rio Tinto discovered the deposit in 2004. It is estimated to contain more than 27 million carats of diamonds.

Rio Tinto announced earlier this month it would abandon the mine, despite spending about $500 million on it over the years, by the end of 2016 to conserve cash and cut costs.

Mines Secretary Balvinder Kumar told Reuters in an interview the withdrawal came as a surprise to the government since Rio was close to receiving a forest clearance for the mine from the environment ministry.

Rio Tinto’s decision came at a time when the government was seeking the help of the firm and its rivals, such as Anglo American, to explore for diamonds and gold to make India a major mineral producer.

“It’s a commercial decision taken by their headquarters in which we could have not done anything,” said Kumar, who has been briefed by Rio Tinto India management on the exit.

“Bunder is one of the best deposits in India and we would like to make sure that it is tapped.”

Kumar said he would talk to parties interested in Bunder when Rio Tinto formally hands the project back to the state government of Madhya Pradesh, where it is located.

He said Madhya Pradesh already had a lot of data on the mine that can be shared with potential bidders or any government company willing to develop it. Rio Tinto has said the company would work with the government on the future of Bunder and was “looking at options for a third-party investor to carry forward the development of the project”.