Odisha to auction six mineral blocks in FY17, seven more in next fiscal

After successful auctioning of the Ghoraburhani-Sagasahi iron ore block, where Essar Steel was declared the preferred bidder, the Odisha government has geared up to auction six more mineral blocks in this fiscal.

The blocks lined up to go under the hammer are a mix of iron ore, limestone and bauxite blocks. The combined market valuation of these blocks is estimated at Rs 18,620 crore.

Among the identified blocks, two – Netrabandh Pahad and Kalmang South (both in Sundargarh district) – are iron blocks and three – Kottameta in Malkangiri district, Garamura in Nuapada district and Jampalli-Pikrijharan in Bargarh district – are limestone deposits. The Malda block in Koraput district is the lone bauxite block ion offer.

 

Besides this, the state government has readied seven more blocks for auctions in the next fiscal, six being iron ore and one limestone block.

The Ghoraburhani-Sagasahi iron ore block already auctioned has 99.54 million tonnes (mt) of iron ore, including 84.92 mt high grade ore of 63.23% iron content. Essar Steel emerged as the preferred bidder, quoting a premium 44.35% higher than the reserve price. Jindal Steel & Power finished a close second with a price quote of 44.3%. Seven companies, including Tata Steel, had cleared the technical bids for the block.

The block is at G2 exploration stage and located in Koira sector in Sundargarh district. The block, with deposits of 99.54 mt, has been reserved for integrated steel plant as end use.

The state government has issued the letter of intent (LoI) to Essar Steel. The LoI is valid for three years from the date of issue. Within this period, Essar has to obtain all statutory clearances. After receipt of the necessary permits, the government will execute a mine production cum development agreement with the steel company.

Essar Steel runs a 12 million tonnes per annum (mtpa) iron ore beneficiation plant at Dabuna in Keonjhar district and six mtpa pelletisation complex at Paradeep.

The mineral concession area is spread over 139.16 hectares (ha), including 20.88 ha forest land, 110.69 ha government land and the balance 7.58 ha private land. Survey of the mineral block has been done by the Geological Survey of India.