L&T seeks mining lease from Odisha government

Global engineering and construction giant Larsen & Toubro (L&T) on Monday urged the Odisha government to grant mining lease (ML) for two bauxite deposits in Kalahandi and Rayagada districts.

The appeal was made in the light of the amended Mines and Minerals (Development and Regulation) Act, 2015.

Since L&T already has a prospecting license (PL) over Sijimali and Kutrumali bauxite mines located in the two districts, the company is hopeful to get the two deposits in the state.

"Since we have the PL, L&T is eligible to get mining rights over the two bauxite deposits under the new MMDR Act," L&T's group's executive chairman A. M. Naik told media persons after meeting Chief Minister Naveen Patnaik here.

"We have requested the state government to recommend mining lease in our favour and also expedite permissions for our alumina refinery project," he added.

Naik also met chief secretary G. C. Pati and steel and mines secretary R. K. Sharma.

Sources said, L&T had won PL for Sijimali and Kutrumali bauxite mines with a total deposit of close to 300 million tonnes, in 1992.

But two years later after the expiry of PL, the state government 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 alumina refinery of three million tonne per annum (mtpa) capacity at Rayagada.

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

However, Vedanta Aluminium Ltd (VAL) bought 24 percent stake in the project in 2012 after Dubal walked out of the SPV.

Now, the grant of ML to L&T over the bauxite deposits can come in handy for VAL, which is running its refinery and smelter projects at 25 percent capacity in the state, said sources.

Vedanta's bid to secure alternate bauxite supply for its Lanjigarh refinery through the joint venture with L & T has received a shot in the arm with several legal luminaries ruling out any legal hurdle in realisation of the proposal.

The Odisha government had initiated legal consultation with senior lawyers of the Supreme Court and the Advocate General to get their opinion about whether to grant ML or not.

Supreme Court counsel Uday U. Lalit, now a Supreme Court judge, in July 2013 had opined that L&T has a preferential right to be granted ML as per provisions of the Mines and Minerals (Development & Regulation) Act 1957.