Iron ore manufacturing dips in Odisha, three bidders give up blocks

Express News Service
BHUBANESWAR: With shortfall in manufacturing and provide of iron ore from giant variety of mines auctioned earlier than lease expiry on March 31, 2020 affecting the industries, vesting orders have been issued to 19 mines in Odisha.

In truth, iron ore manufacturing has considerably declined within the State – from 90.28 million matric tonne (MMT) and 102.81 MMT throughout April and November interval of 2019 to 60.46 MMT and 91.58 MMT respectively throughout the identical interval in 2020.

Three profitable bidders, Socied De Fomento Industrial Pvt Ltd, winner of Nadidih iron ore block, Vishal LPG Industries (Nadidih iron ore and manganese block), Tarama Apartment Pvt Ltd (Teherai iron ore and manganese block), surrendered their blocks by forfeiting safety deposits as they discovered it unsustainable. 

The State authorities, in the meantime, has revoked financial institution ensures of Jindal Steel and Power, winner of Guali iron ore mines, and Shyam Ores Jharkhand Pvt Ltd, winner of Jilling-Langalota iron ore block, for refusing to execute lease deed.

Non-operationalisation of working mines auctioned earlier than March final yr has created acute scarcity of iron ore within the nation. During 2019-20, manufacturing of iron ore within the nation as on September, 2019 was 110.95 MMT whereas cumulative manufacturing of ore until September, 2020 was solely 76.01 MMT registering a drop in manufacturing by 31.5 per cent.Foreseeing the disaster, the Centre has proposed modification in Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules (MCR), 2021 prescribing stricter situations in opposition to defaulting leaseholders.

The draft modification of MCR-1960, circulated to states for pre-legislative session with stakeholders, mandates profitable bidders to make fee equal to the income share and different statutory levies that will have been payable on the prescribed stage of minimal manufacturing/dispatch targets on quarterly foundation to make sure easy availability of minerals.

“In case lessee does not maintain minimum dispatch prescribed in the rule for three consecutive quarters, State government may terminate such lease after giving a reasonable opportunity of being heard,” the draft Bill stated. Of the 46 working mines, whose leases expired on March 31, 2020, 24 mines are in Odisha.

As numerous measures taken by the Central and State governments to deal with the brief provide have been inadequate in assembly demand, this prompted the Centre to go for additional modification within the Rules to make sure easy provide of ore.

“Decline in production and dispatch of important mineral such as iron ore not only leads to spike in its market prices but also affects the manufacturing of iron and steel in the country which is one of the core sectors of the economy,” the Ministry of Mines stated.

The Ministry has proposed to strengthen norms of minimal manufacturing/dispatch by way of modification of Rule 12A of the MCR Rules, 1960 so as to guarantee sustained provide of mineral available in the market in future.