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Mining firm gets Rs 45 crore bill from Gadchiroli police for providing security to mine

The company, which got a 348-hectare lease for the mine in Surjagad in 2007, has hardly been able to operate on a regular basis for the past four years.

Written by Vivek Deshpande | Nagpur |
March 27, 2021 3:11:50 am
gadchiroli police newsThe Gadchiroli police have given a bill of Rs 45 crore against to Lloyds Metals and Energy Limited Company for providing security to its iron ore mine in Etapalli tahsil (Source: ANI/Twitter)

THE Gadchiroli police have given a bill of Rs 45 crore against to Lloyds Metals and Energy Limited Company for providing security to its iron ore mine in Etapalli tahsil. This has put another question mark over the company’s operations as also over Gadchiroli’s long awaited maiden industrial unit – a steel manufacturing unit.

The company, which got a 348-hectare lease for the mine in Surjagad in 2007, has hardly been able to operate on a regular basis for the past four years.

The last two years have been particularly bad, first due to Naxal violence and after that due to the Covid-19 pandemic. So far, the company has been able to extract at least five lakh tonnes of iron ore from the mine, which is supposed to be a captive mine for its proposed Gadchiroli factory. The work on the factory was inaugurated by then Chief Minister Devendra Fadnavis in 2018.

The company has sought cancellation of the security charges in government court.

Gadchiroli Superintendent of Police Ankit Goyal refused to comment on the issue. Collector Deepak Singla, however, confirmed that the police have raised a bill of Rs 45 crore against the security provided to the company’s mining operation.

“The police are not mandated to provide security to the company’s operation. While being engaged in fighting Naxals, it is not possible for the police to provide security to the company by open a road of 55 km to provide safe passage from production to transportation of the ore to a safe point. But we did provide security whenever we could and have raised a bill against that,” Singla told The Indian Express.

Asked how the company will carry out its operations without security in one of the most sensitive Naxal-affected areas of the district, Singla said, “The company has to take its own call on this issue. Nowhere do the police provide such security. The company needs to undertake confidence-building measures among locals to win their hearts and, if required, engage a private security agency for its operations.”

Singla added, “Our job was to provide them the lease. Nowhere in the lease agreement has security been assured.”
A senior company official said on condition of anonymity, “They have sent us summary bills to the tune of Rs 45 crore without prior notice and without any description of the 80-90 items under which charges have been applied. We had no inkling and there was no government order that we have to pay the bill.”

The official struck a contrasting note with the Collector’s condition, saying, “It’s government’s job to ensure law and order.” He also said the company has undertaken many confidence building measures.

The company has now engaged an Odisha-based mining contractor, Triveni Earth Movers, for its Surjagad operations. “They have already moved their equipment on the site,” the official said.

Another official, however, said, “Any steel company mining its own ore saves up to Rs 5,000-6,000 per tonne. At this rate, the company has already saved at least Rs 250 crore. Today the company has to pay Rs 9,000 per tonne to National Mineral Development Corporation. Moreover, the company has paid a royalty of only Rs 13 crore. So, paying the security bill shouldn’t be such a big issue for the company.”

He added, “Fadnavis was angry with the company for not investing some of the profits in starting the construction of its proposed steel unit in Gadchiroli and had chided the company officials in a meeting. Even the current Home Minister, Anil Deshmukh, had directed the company to initiate work on its promised steel unit before expecting the administration to do the needful,” the official said.

The official also said that the company was supposed to provide employment to 975 locals, construct a hospital, a school, provide water, undertake environment mitigation measures and set up self-help groups. None of this has been done, according to him.

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