Essar Steel bags iron ore block in Odisha

Co pips contenders like Tata Steel, JSPL and JSW steel; quoted a price 44.5% over the reserve price of the block

Essar Steel has emerged as the successful bidder in the first iron ore block offered for e-auctions in Odisha. A robust bidding helped the steel maker to bag the block, upstaging strong contenders like Tata Steel, Jindal Steel & Power Ltd (JSPL) and JSW Steel.

“Essar Steel has won the iron ore block in Odisha. The company emerged as the H1 bidder, quoting a price of 44.5% over the reserve price of the block. The first ever iron ore block auction in Odisha has fetched a better response compared to other mineral bearing states", said a source in the know of the development.

The financial bids for the auctions were completed after seven steel firms had qualified in technical bidding. Tata Steel, JSPL, JSW Steel, Essar Steel, Bhushan Steel Ltd, Bhushan Power & Steel Ltd and Rashtriya Ispat & Nigam Ltd (RINL) had submitted technical bids.

Deepak Mohanty, director (mines), Odisha declined to comment on the name of the successful bidder.

“The financial bidding for the iron ore block has been completed. The name of the successful bidder would be disclosed on Friday after government approval", he said.

The Ghorhaburhani-Sagasahi iron ore block offered for e-auctions is at G2 exploration stage and located in Koira sector in Sundargarh district. The block, with deposits of 99.54 million tonne, has been reserved for integrated steel plant as end use and mining lease (ML) will be issued to the successful bidder.

The mineral concession area is spread over 139.16 hectares (ha) including 20.88 ha forest land, 110.69 ha government land and the balance 7.58 ha private land. Survey of the mineral block has been done by the Geological Survey of India (GSI).

The state government would issue a 'Letter of Intent' to the successful bidder upon payment of first installment of the upfront payment. The state government and the state government would enter into a mine development cum production agreement.