JSL moves SC to stall Tata's chrome mine lease renewal

Jindal Stainless Ltd (JSL) has filed a special leave petition before the Supreme Court with a request to direct the Odisha government against recommending lease renewal of chromite mines belonging to Tata Steel for the third time.

Earlier, JSL along with other chrome users, Indian Metals and Ferro Alloys (IMFA), Balasore Alloys (earlier Ispat Alloys), Ferro Alloys Corporation (FACOR) and Nav Bharat’s had filed case in the Orissa High Court opposing Tata’s lease renewal. But the case was dismissed by the court.

JSL has been demanding that the Odisha government must recommend a reduced chromite bearing area in favour of Tata Steel as per its captive requirement, which is also in conformity with the Miners and Mineral Development and Regulation (MMDR) Act.

“Captive requirement of Tata is way less than the area held by it under the mining lease and excess unutilised reserves held by Tata is not in the interest of mineral development,” it said in its appeal to the Supreme Court adding that the Orissa High Court has struck down its plea without giving it a chance to be heard.

As per MMDR Act, though first renewal of mining lease is a right of the lease holder, the second and subsequent renewal is to be granted keeping in mind the interest of mineral development, which is value addition of the ore.

JSL says Tata Steel, which runs 50,000 tonne per annum ferrochrome plant in Odisha, sells most of chrome ore and concentrate to out of Odisha users and buyers abroad. It said, the state government, using the power vested on it by MMDR act, must scale down the 406 ha area currently held by Tata Steel and the rest areas should be distributed among end user industry.

To support its argument JSL says reduction of area has been done by the state government at least twice before and hence, the same practice must be followed this time also. The original lease granted to Tata Steel in 1953 was for 1,813 hectares, which was subsequently scaled down to 406 ha, following the Supreme Court judgement in 1990s.

Tata's lease validity of Sukinda chromite mines ended in January 2013. Though the renewal application of the company is still under process, JSL said, the Odisha government has already made up its mind to grant the third renewal, citing a report published by Indian Bureau of Mines (IBM) in June this year.

JSL has set up a stainless steel plant having 1.2 million tonne per annum capacity at Kalinganagar and needs at least 625,000 tonne chrome year every year to run its plant. Though it also has a chrome mine in Odisha, it has been demanding another lease citing captive requirement.