October 1, 2008

Global Steel Majors Seek Faster Allocation of Indian Iron Ore Mines

Text of report by Indian news agency PTI

New Delhi, [Tuesday] 30 September: World's leading steel makers including Posco and Arcelor Mittal have asked the government to speed up allocation of iron ore mines, saying they are critical for their green field projects planned in India.

The steel majors also want the centre to ensure mineral linkages and fast statutory clearances for timely completion of their billion- dollar steel projects.

"Among the major impediments that the investors including Posco and Arcelor Mittal want to be addressed include mineral linkages, allotment of captive iron ore mines and land acquisition," Steel Secretary P.K. Rastogi told PTI.

The secretary had Monday convened a meeting of mega steel investors to take stock of their problems in setting up green field projects, which are essential to meet government's target of adding 124m tonnes of steel capacity by 2012.

"We have heard from major steel investors their concerns and requirements for setting up green field projects. Ministry will put forth the points before the inter-ministerial group soon," Rastogi said.

Besides the representatives of Arcelor Mittal and Posco, senior officials from Tata Steel, Essar, JSW Steel and Ispat Industries apprised the ministry of the bottlenecks being faced by them in execution of green field projects.

"We have applied for prospecting licence for mining in Orissa and are waiting for a response from the government," Arcelor Mittal India CEO Vijay Bhatnagar said.

The company, however, plans to commence the steel plant by 2012, he added.

Arcelor Mittal plans to set up two integrated steel plants of 12m- tonne capacity each in Orissa and Jharkhand. The likely investment in each of the projects would be about 40,000 crore rupees [one crore equals 10m].

South Korean steel behemoth Posco, too, has lined up a whopping 52,000-crore-rupee investment in Orissa for a 12m-tonne steel plant.

Both Posco and Arcelor Mittal would require 600m tonnes of iron ore over a span of 30 years to run their steel plants at optimum capacities.

While Arcelor Mittal has been granted mining lease of Karampada iron ore mines in Jharkhand, Posco is yet to secure the raw material for its Orissa project.

Posco has been eyeing the Kandhadar iron ore mines, which has an estimated reserve of about 160m tonnes. The Naveen Patnaik government [in Orissa] had earlier recommended the prospecting licence of the mines to Posco. The centre, however, objected to it saying Orissa government should give a hearing to all 251 applicants for the mines before taking a final call on its allocation. The hearing process has been completed, but the government has not yet submitted its recommendations to the centre.

Originally published by PTI news agency, New Delhi, in English 1813 01 Oct 08.

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