The Madhu Koda-led coalition government in Jharkhand has decided not to offer a piece of the Chiria iron ore mine to Mittal Steel.
Decides against giving the steel giant a piece of Chiria mines
KOLKATA: The Madhu Koda-led coalition government in Jharkhand has decided not to offer a piece of the prized 1,400 million tonne Chiria iron ore mine to Mittal Steel, which has all but scuttled the company’s Rs 20,000-crore, 10 million tonne per annum green field project in the state.
Though the state government has not spelled it out, the latest move is an indication that it will throw its weight behind the Steel Authority of India Ltd (SAIL)’s claims on all the seven mining blocks that make up Chiria. The state-owned steel producer inherited the mining lease for Chiria when it merged the erstwhile Indian Iron and Steel Company (IISCO) with itself.
The Jharkhand government had opposed the transfer of mining lease to SAIL and the issue is pending before the Ranchi High Court. A court-appointed tribunal ruled in favour of SAIL’s claims on the mines and now with Union steel minister Ram Vilas Paswan and the state government favouring SAIL’s sole access to mining at Chiria, Mittal Steel cannot hope to secure linkages from mines said to have some of the best ore reserves in the world.
Jharkhand government officials said Mittal Steel has been offered other ore deposits in the state, but the company has turned down the offer saying the region was not suitable for use of high-capacity equipment. Mittal Steel India’s chief executive officer (CEO), Sanak Mishra, said there was no question of putting up a mega green field project in the state without access to ore deposits in Chiria.
Of course, with the Jharkhand project getting almost grounded, prospects of Mittal Steel’s Orissa project seem to have brightened. The world’s largest steel producer has signed a memorandum of understanding (MoU) with the Orissa government for a 10 million tonne plant at an investment of Rs 20,000 crore. But, Jharkhand government officials point out that mining lease in Orissa, too, does not come easy.
Posco, which plans a $12 billion, 12 million tonne plant at Paradip, is yet to secure a lease, or possession of land, even after a year of announcement of the project, they point out.
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