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Odisha approves long-term bauxite sale to Vedanta at market prices

70 per cent of the saleable stock of bauxite would be made available for long-term linkage (LTL) and the rest 30 per cent is to be sold through national e-auctions

BS Reporter  |  Bhubaneswar 


Vedanta's efforts to source local for its is finally paying off. The refinery which has been running on externally sourced since its operations can now buy on a long-term basis from state-owned Mining Corporation (OMC) at market prices discovered through auctions.

The decks for were cleared after the Cabinet approved a policy for As per the terms of this policy, 70 per cent of the saleable stock of would be made available for (LTL) and the rest 30 per cent is to be sold through national e-auctions.

The weighted average price derived from the national e-auction would be the price. The floor price for the national e-auction would be kept at cost of production plus a profit margin of 50 per cent.

Earlier, the government had constituted a committee under the chairmanship of the Chief Secretary to make appropriate recommendations on nature and detailed modalities for the supply of ore by the OMC to the as and when any mining leases are operated by OMC.

At the national e-auctions, OMC would directly deal with the end-user industries. Participation by the traders would be considered only if there is lack of adequate response from the end-user industries.

Though has reserves of 1968.86 million tonnes, annual production is only 9.2 million tonnes.

The state cabinet decided that more blocks would be explored through outsourcing by the steel & mines department. OMC would explore the statutory clearances for the blocks assigned to it. If the progress of the blocks is not found to be satisfactory, they can be surrendered and auctioned for PL (prospective license) cum ML (mining lease) by the state government.

A part of the Karlapat area, excluding the ML area granted to OMC, would be de-reserved and auctioned for PL cum ML for speedy exploitation of to ensure revenues for the government.

First Published: Wed, February 21 2018. 20:10 IST