L&T on verge of bagging bauxite deposits in Odisha

The Odisha government is sending its final compliance to the Union Mines Ministry on L&T's bid for the mines

Diversified conglomerate Larsen & Toubro (L&T) is on its way to secure the Kutrumali and Sijimali bauxite deposits in Odisha, with combined reserves of over 300 million tonne. L&T holds the prospecting license (PL) over the twin deposits and is entitled to bag the mining lease (ML) under the new Mines and Minerals (Development & Regulation) MMDR Act.

The Odisha government is sending its final compliance to the Union Mines Ministry on L&T's bid for the mines.

“We have clarified to the mines ministry that there is no overlapping of the Kutrumali and Sijimali leases with any of the mines held by state-owned Odisha Mining Corporation (OMC). The state government has also backed L&T's bid for ML over the deposits as they are a subsisting PL holder,” said a senior government official.

L&T had won PL for Sijimali and Kutrumali bauxite mines in 1992. But the PL had expired two years later, after which the state government had denied ML to L&T since it had no end-use plant.

In 2005, L&T through a joint venture with Dubai Aluminium (Dubal), had proposed a Rs 30,000-crore aluminium complex comprising three million tonne per annum (mtpa) alumina refinery at Rayagada, 1.5 mtpa smelter plant and a captive power plant (CPP).

The ultimate capacity of three mtpa of the proposed alumina refinery will require bauxite of nine mtpa, considering three tonne of bauxite for one tonne of alumina. This requirement will be met partly from Kutrumali (three mtpa) and partly from Sijimali (six mtpa).

Though a special purpose vehicle (SPV) called Raykal Aluminium was formed for the purpose, the project has so far remained a non-starter.

Seven years later, in 2012, when Dubal walked out of the SPV, Vedanta Aluminium (now Vedanta) bought 24% stake in the project.