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Sesa Sterlite expects Goa mining ban to be lifted soon

Resumption of mining in Goa is expected by September

Press Trust of India  |  New Delhi 

The Supreme Court is expected to rule on lifting an 18-month old mining ban in Goa soon, after which operations may resume in September, following the monsoon, an official of Sesa Sterlite said today.

"Our assumption is that the Supreme Court judgement on lifting the ban in Goa is expected any time now. It has already reserved its order on capping production," Sesa Sterlite Vice President (Corporate Affairs) for Iron Ore Business A N Joshi said on the sidelines of an OreTeam conference here.

Resumption of mining in Goa is expected by September as heavy rains lash the state during June-July, he said.

"Due to ongoing elections and procedural issues, any micro-level decision to restart mining will come into force only by June. Thereafter, monsoon will kick in in Goa, so the real mining is expected only by September," he said.

On March 27, the Supreme Court reserved its order on capping the volume of iron ore to be extracted annually in Goa and said it will pass the order in a "few days".

A court-appointed panel had recommended iron ore mining of up to 20 million tonnes annually be allowed in Goa. The Goa government had favoured a limit of 45 million tons.

"Capping of iron ore mining, as suggested by the expert panel, will lead to loss of livelihood to many persons in Goa. So I hope that the court will also take a look at this aspect while taking any decision on capping the mining," Joshi said.

Sesa Sterlite, the main subsidiary of mining conglomerate Vedanta, is the largest private sector iron ore producer in India. Its iron ore business, earlier known as Sesa Goa, is based in Goa.

Sesa Sterlite's business suffered after the mining ban imposed by the apex court in October 2012. It reported a negative earnings before interest, taxes, depreciation and amortisation of Rs 148 crore during April-December 2013.

Operations in all 90 mines in Goa were halted by the Supreme Court on the basis of the Justice M B Shah Commission report, which estimated a Rs 35,000 crore loss to the exchequer due to illegal mining over 12 years.

Addressing the conference, Joshi pitched for incentives to export ore with iron content of less than 55 per cent, saying there are few takers for this grade in India.

"Such low-grade iron ore cannot be kept indefinitely in mines in absence of buyers. So the better way would be that they get exported but that cannot be done unless the government abolishes 30 per cent export duty and incentivises the industry," he said.

The government levies 30 per cent duty on export of all types of iron ore.

First Published: Fri, April 04 2014. 19:42 IST