JSW seeks PMO intervention for securing iron ore mining lease

Sajjan Jindal, chairman, JSW Steel, said in a letter ore output has not stabilised in state despite the Supreme Court lifting mining ban in April

JSW Steel has sought the intervention of Prime Minister’s Office to secure the lease for an iron ore mine in Maharashtra, saying the state government is not issuing the same despite the Union Mines Ministry’s recommendation.

In a letter to the PMO Joint Secretary, B V R Subrahmanyam, JSW Steel Chairman Sajjan Jindal said the ministry had approved the mining lease for Damkodwadvi iron ore mine in Maharashtra on May 18, 2012.

“However, Government of Maharashtra has not been issuing the Letter of Intent as new MMDR Bill is pending. Even as per proposed MMDR Bill, this is a case of seamless transfer from Prospecting Lease (PL) to Mining Lease (ML),” he said in the letter dated August 5.

Seeking immediate support from the PMO, Jindal said there are some other mines in Maharashtra and Karnataka that either need to be allocated or require grant of PL. This includes Phururmeta iron ore mine in Maharashtra, where the company is waiting to secure PL to begin the preliminary work. The Mines Ministry had cleared the proposal in September, 2009.

JSW is the largest private sector steel manufacturer in India with 14.3 million tonne (MT) capacity. However, it does not have any captive iron ore mine to run its operations.

The two mines - Damkodwadvi and Phururmeta - were alloted to now merged JSW Ispat Steel for its Dolvi steel mill, near Mumbai. The company was permitted to mine 7.5 million tonne iron ore from the Damkodwadvi mine in the Gadchiroli district.

In an environmental public hearing held on May 8, 2013 for mining in the block, the Gram Sabha of Damkodwadvi village had recommended that the Maharashtra government reject the proposed mining lease for the project, citing protests from the local people.

Meanwhile, Jindal also said in his letter that iron ore production has not stabilised in Karnataka despite the Supreme Court lifting the mining ban in April and requested the PMO to constitute a specific committee to oversee the progress and clear regulatory hurdles.

JSW Steel operates a 10 MTPA plant in Karnataka’s Vijayanagar and has invested about Rs 40,000 crore. The firm has put expansion of the plant’s capacity on hold due to uncertain iron ore situation in the state. “Industry is getting only 13.75 MT against the demand of 32-35 MT per annum (in Karnataka). In order to expedite the process of regulatory clearances, specific committee is required to be set up,” Jindal said.