The environment appraisal committee of the Union environment ministry has given the go ahead to state-run miner NMDC Limited to operationalise 10 million tonne per annum greenfield iron ore mine at Bailadila in Chhattisgarh.
The Deposit-13 mine, spread over 413.74 hectares of land, would be jointly developed by NMDC and Chhattisgarh Mineral Development Corporation (CMDC) and majority of the output would be earmarked for the raw material needs of steel and sponge iron plants in the state, a senior steel ministry official told The Indian Express.
The expert appraisal committee (EAC) in its meeting on March 18 granted environment clearance to the proposed iron ore project, which has mineable reserves of 324.69 million tonne (MT). The NMDC-CMDC JV would be able to exploit 10 MT of ore annually for over 40 years, the official said.
The JV had already secured forest clearance for 315.81 hectares of land in November last year for operating the mine. The JV was formed in 2008 and NMDC has 51 per cent stake in it while the remaining is with CMDC.
NMDC chairman Narendra Kothari told this newspaper on Wednesday that after completing necessary formalities with the state government, efforts would be made to operationalise the mine soon. “We hope that the output from the mine will find buyers from the steel and sponge iron sectors in Chhattisgarh and will meet their raw material needs. Our prices have not been unreasonable” he said.
Chhattisgarh sponge iron manufacturers association president Anil Nachrani claimed that iron ore paucity during the past three years has led to the closure of 10-15 sponge iron projects in the state, while over 40 units have curtailed their output.
“Our annul requirement is about 14 MT, but we get barely 4 MT and are constrained to source the mineral from neighbouring Orissa at market prices,” Nachrani said over telephone.
He said the sponge iron makers hope that the output from the Deposit-13 mine would be made available to sponge iron makers at concessional rates. In fact, in January 2013 the state government had cautioned NMDC that it could invoke the Right of Pre-emption under the Mineral Concession Rules 1960 under which it could take over the PSU’s output and distribute it to the company’s local buyers.
Countering his contention, Kothari said NMDC has not been unfair in supplying iron ore to the projects in the state and is meeting their production needs.
Endorsing his contention, the steel ministry official said that offtake from the sponge iron units in Chhattisgarh has not been encouraging and the state’s steel and sponge iron plants have been beneficiaries of NMDC’s output. NMDC is targeting 35 MT production and 38 MT iron ore sales for 2015-16. The firm has commenced trial run for Deposit-11B iron ore mine in the same area on March 29 at an estimated cost of Rs 600 crore.