Centre seeks clarification on Posco's PL application

Ministry has asked Odisha to clarify various aspects including concerns about environment

The state government will take two week’s time to reply to queries of Union mines ministry on grant of Khandadhar iron ore lease to Posco India, state steel and mines minister said today.

“The Union mines ministry has sent us seven queries regarding its impact on environment and forest along with other issues. It will take about two week to assess the queries and form a reply,” said Rajnikant Singh, the steel and mines minister.

The Union mines ministry, which is expediting the process of allotting prospecting licence (PL) of Khandadhar iron ore mines to Posco, has asked the state government to give its clarifications regarding various aspects including concerns about environment.

PL is generally valid for three years, after which a prospector has to apply for a mining lease.

Access to iron ore, the main raw material in making steel, is the most important factor in Posco deciding to set up the plant in India.

The Supreme Court in May this year had set aside an earlier order of the Odisha High Court that had quashed the state government’s recommendation of PL in favour of Posco for Khandadhar iron ore reserves in Sundergarh district.

The apex court had directed the Union mines ministry to review the possibilities of allowing the PL to the company.

Odisha government had first recommended granting of PL to Posco in 2006. The Centre had returned the recommendation back to the state government asking it to submit the recommendation again after hearing all the applicants who have applied for the same lease. Based on this, the state government concluded hearing of all the applicants over a time spanning two and half years and re-recommended the same in favour of Posco in 2009. This recommendation has been upheld by the Supreme Court last May.