Vedanta hopes to restart mining in Goa by Jan-Feb

Metals and mining conglomerate Vedanta Resources expects to resume iron ore mining in Goa early next year.

"For the past few years the Goa mining sector has been shut down... We are hopeful of resuming mining operations in Goa in January-February 2015," Vedanta Resources CEO Tom Albanese told PTI.

Albanese, who is also the CEO of Sesa Sterlite, a Vedanta subsidiary, said the company hopes for some steps to be taken by the Centre to rescue the mining sector which has borne the brunt of high exports duty on ore.

Besides, he added that the company is engaging with the Goa government and the Ministry of Environment and Forests to get approvals for resuming mining operations.

The Supreme Court in April lifted the ban on mining in Goa with certain conditions. The ruling imposed an interim restriction on the maximum annual excavation of 20 million tonnes per annum from the mining leases in the state.

However, mining can't be carried out until the renewal and execution of mining lease deeds by the state government.

Albanese also stressed that India needs to scrap export duty on iron ore in the face of sliding prices globally, especially on low grade that is exported from Goa to make mining a profitable proposition.

He has said that "ores that have been typically mined in Goa including that of Sesa have been of a lower grade than typically desired by the Indian steel sector" and is exported where global prices had already nosedived.

There is 30 per cent export duty on iron ore at present.

As per industry experts the duty was imposed when prices of ore were sky-rocketing at $180-200 per tonne. They have plummeted to a 5-year-low to $80 per tonne for best grades '63 Fe'. Iron ore grade produced in Goa is '58 Fe' or below.

Goa Chief Minister Manohar Parrikar has demanded that the Centre withdraw export duty on low grade iron ore.

Miners body FIMI had also requested the Centre to do away with export duty to help the sector. India used to be the third largest global exporter of the ore a few year ago.

Iron ore exports declined by 61.46 per cent to USD 52 million in August.

The exports of iron ore, a key steel making raw material used to be about 100 MT, which declined to 62 MT in 2011-12, 18.37 MT in 2012-13 and 14.42 MT in 2013-14 on account of a number of factors including high duties and freight rates.