K'Taka puts ArcelorMittal project on fast track

ArcelorMittal, the world’s largest steel maker, is likely to be the first among 53 steel companies that signed a memorandum of understanding (MoU) with the state government a month ago to secure captive iron ore mines in Karnataka. If everything goes as planned by the government, the company could get a mining licence for 521 acres of mines in the ore-rich Ramanadurga region of Bellary district.

The state government, which recently signed an MoU with ArcelorMittal for its proposed 6 million tonne per annum (MTPA) steel plant at Kuditini in Bellary district, has put on fast track the process to issue necessary approvals to the company. Arcelor Mittal had stated that this capacity will envisage an investment of Rs 30,000 crore.

In less than a month after signing the MoU with the steel giant, the B S Yeddyurappa government has recommended to the central government for according approval for allotment of captive iron ore mines spread over 521 acres in Ramanadurga.

This comes ahead of existing applicants for iron ore mines like Jindal Steel, NMDC, KIOCL, among others. Jindal Steel, which produces 7 MTPA of steel at Toranagal in Bellary district has been waiting for allotment of captive mines for the past decade. Its expansion to 16 MTPA will largely depend on allotment of captive mines.

The state government had signed an MoU with L N Mittal, chairman of ArcelorMittal on June 3, during the global investors’ meet for its steel plant and a 750-Mw captive power plant.

Confirming the development, State Industries Minister Murugesh R Nirani told Business Standard: “The chief minister’s office has sent a recommendation to the Centre for allotment of captive iron ore mines in Ramanadurga region. The exact quantity of iron ore that will be available in this area is yet to be ascertained.”

In reply to an email query from this paper, an official spokesperson from ArcelorMittal did not comment on the exact extent of iron ore mines required for them. As regard to water, the company said it requires around 40 million gallons per day of water for its steel plant.

As a first step towards facilitating the company to set up its plant, the government had issued final notification for acquisition of 4,500 acres at Kuditini in Bellary district. ArcelorMittal India has already deposited Rs 268 crore with the Karnataka Industrial Area Development Board for acquisition of land.

In November last year, a high-level team led by ArcelorMittal group board member Sudhir Maheshwari and Executive Vice-President Vijay Kumar Bhatnagar had held discussions with the chief minister, Nirani, Industries Secretary V P Baligar and other officials to discuss the project proposals. The team had also visited three locations. Subsequently, the state high-level clearance committee had given an in-principle clearance in January.

In addition to an MoU with ArcelorMittal, the Karnataka government had signed MoUs with 52 other steel companies for a total investment of Rs 2.56 lakh crore, including Posco of South Korea.