India rejects Vedanta's bauxite mine request

BHUBANESWAR, India (Reuters) - The environment ministry has rejected London-listed Vedanta Resources Ltd's request to mine bauxite in the Niyamgiri hills of Odisha state after local residents opposed mining in the area they consider sacred, an official said on Saturday.

Vedanta Aluminium's 1 million tonne-a-year alumina refinery in the eastern state has been struggling to source key raw material bauxite since its commissioning in August 2007. The company has been forced to import bauxite as a result.

"Vedanta forest clearance has been rejected. There will be no mining in Niyamgiri hills," Saswat Mishra, Chairman of the Orissa Mining Corporation told Reuters. An official of Vedanta declined to comment.

The mining project near the Lanjigarh refinery in Kalahandi district, about 450 km (280 miles) from state capital Bhubaneswar, had drawn the anger of rights groups globally.

India's top court in April last year ordered the state to submit a report based on the views of the local villagers to the federal environment and forests ministry. Residents of all the 12 villages whose opinion the state authorities sought had unanimously voted against the mining.

(Reporting by Jatindra Dash; Editing by Michael Perry)