Karnataka seeks CEC nod to raise iron-ore production

SC has capped iron ore production at 30 million tonnes per annum from 115 mines in the state

The Karnataka government has sought the approval of the Central Empowered Committee (CEC) of the Supreme Court to raise the iron-ore production of certain Category-A mines. The Supreme Court has capped iron-ore production from the state at 30 million tonnes (mt) a year.

Steel mills and sponge iron producers in and around Karnataka require 32-36 million tonnes of ore a year. Production for the current financial year (FY14) is estimated at 21 million.

“We have asked the CEC whether we can raise the production of those Category-A mines with proven reserves. But the CEC told us to wait till all the mines in Category-A and -B give their reclamation and rehabilitation (R&R) plans. There is a great urgency for us to give all R&R plans,” said Tushar Girinath, secretary (mines).

SHOCK AND ORE

• Steel mills in Karnataka require 32-36 million tonnes a year
• Only 14 mines (11 in Category-A and three in Category-B)  have restarted production and can produce 18 million a year, including 10 million from NMDC
• The Supreme Court has capped production in the state at 30 million (25 million from Bellary and five million from Chitradurga and Tumkur)
• Iron ore availability in 12 months is pegged at 21 million
• The state cancelled 51 Category-C mines following SC order

He added there were certain mines that could not be operationalised because of some civil disputes. “We have asked the CEC to permit us to increase the capacity of some mines, even for a temporary period, under the direction of the court till we set our house in order. Whatever we do, in 12 months, we can produce about 25 million tonnes, leaving a gap of about five million tonnes,” he said.

Making a presentation at the annual conference of Federation of Indian Mineral Industries (FIMI) here, Girinath said ore production could be increased by four or five million if the CEC approved capacity enhancement. It could be increased to 25 million from 21 million, he said.

Explaining the outlook for ore availability in the next year, Girinath said: “In the next 12 months, whatever we do, we are not going to get anything out of Category-C mines. The process to auction Category-C mines would take some more time.”

Earlier this month, the state cancelled all 51 Category-C mines by the direction of the Supreme Court.

The court has capped production at 30 million a year for all Category mines. However, till now, only 11 mines in Category-A and three in Category B have resumed mining and the availability of ore is 18 million. Another 2.7 million could be added from the state government-owned Mysore Minerals, Girinath added.

“If we can get some favourable orders from the CEC, we could reach 25-26 million a year. There would still be a gap of four-five million and, at this stage, we don’t know how to fill that.”

Girinath added there were many mines, with 10,000-25,000 tonnes a year capacity, that didn’t seem interested to resume mining. The state was trying to find out if they were not interested, and, if so, take back their leases and re-allot. He said the state would soon invite all category-A and -B miners for a meeting to sort their issues.