Full halt to iron ore exports now

Sesa Goa to reapply for clearance, others await govt notification

With environmental clearances (ECs) having been suspended of all 93 operational iron ore mines in the state, its export from India would come to a halt.

Export from Karnataka and Odisha was already halted. The chances of revival of export during the current financial year is being almost ruled out.

The Federation of Indian Mineral Industries (Fimi), an apex body of mining companies, reported total iron ore exports at 61.8 million tonnes (mt) during 2011-12, as against 117 mt in the previous year from the three main states of Karnataka, Odisha and Goa. The states have been under a severe mineral crisis for two years.

“It is a big disaster for the mining industry. The MoEF (union ministry of environment and forests) wants to clear mines one by one and the process would easily take up to six months, at least. This means a virtual halt on exports. Already, there are no exports from the eastern India states. Exports are already ruled out of Karnataka. Goa was the only saving grace,” said D V Pichamuthu, Director, Fimi-south.

For the year ended March 2012, iron ore export from Goa was lower by 20 per cent at 43.3 mt, compared to the previous year. Goa largely produces low-grade ore, a majority of which is exported.

The Anil Agarwal-controlled Sesa Goa has planned to apply afresh for clearance to restart mineral extraction. Sesa Goa produced 12.7 mt of ore in Goa during 2011-12, as compared to 14.4 mt the previous year. It owns 374 mt of reserves in Goa and Karnataka.

Other mining companies are awaiting a government notification or order to individual leaseholders on the issue. “We have seen just the environment minster talking about the ban. No notification or order has been issued s o far. We are waiting for the state government’s notification suspending clearances (ECs) or any such order in this regard and draft procedures to obtain fresh ECs or revalidation of existing mines,” said Shivanand V Salgaocar, president, Goa Mineral Ore Exporters Association.

ECs commonly take anywhere between one to two years from the date of application. Hence, there will be no export from Goa for at least a year from now, said Haresh Melwani, a miner-exporter in the state. Total iron ore production in Goa is estimated at five mt this year, as against 53 mt last year. Iron ore produced in Goa is exported primarily to China and around one mt is currently at various jetties; these can be shipped.

The Karnataka government suspended mineral transportation to ports in July 2010, which made extraction difficult for private minining firms, including Sesa Goa.