Steel producers demand re-allocation of mine leases

The steel producers of Odisha have urged the state government to reject the applications of merchant miners for second and subsequent renewal of their iron ore mine leases and re-allocate the properties to the industries having end-use plants in the state.

The fate of 18 such lease renewal applications, most of which belong to stand alone mines, is slated to be decided at a high level meeting tomorrow.

Mines given to ore traders should be cancelled and re-allocated to steel companies operating without captive mines, said the All Odisha Steel Producers Association (AOSF) in a letter to Chief Minister Naveen Patnaik.

These 18 iron ore leases, which were earlier operating on deemed extension basis pending renewal of their mine leases, have stopped operation following an order of Supreme Court in May this year, which said provisional operating clearance or deemed extension after 20 years of first renewal is illegal. The court had directed the Odisha government to take a decision on renewal applications within six months for resumption of operations at these mines.

The court order had affected 26 mines in Odisha, including several mines of Tata Steel, Steel Authority of India Ltd (SAIL) and Odisha Mining Corporation (OMC). Later, the state government allowed operation of eight mines through an express order in case of mines belonging to Tata Steel, SAIL and OMC. It, however, left the decision on rest 18 mines hanging.

The AOSF has demanded that as per Odisha government's policy on second and subsequent renewal, the applications of these 18 mines must be rejected.

"The government of Odisha should refuse renewal of all mining lease areas in cases of second and subsequent renewal which are not in the interest of mineral development," the association said in its letter to the Chief Minister recently, citing a policy resolution.

In October 2012, the state government had taken a decision of not to renew merchant mining leases after 20 years of first renewal in the interest of mineral development. Instead, it had decided to reserve the leases owned by miners without any end-use plants for OMC.

"The government should amend the policy resolution with regard to reserving the balance area for OMC, so that the balance non-renewed mining lease areas should be made available for re-grant and be given to the existing mineral based Industries in Odisha for meeting captive requirement," it added in the letter.

AOSF is an association of many sponge and pig iron producing industries in Odisha. Most of its member industries are operating without having access to captive iron ore and depend upon state-run OMC or other private miners for the raw material.

Though the state government has decided to provide iron ore to steel producers on long term basis, AOSF said, the state government must take steps for grant of captive leases.

"The government should form a committee to assess iron ore requirement of existing steel industries functioning without captive mines and recommend and grant the non-renewed iron ore mining lease areas to these industries for meeting their requirements," it said.