Odisha steps up mining bidding process, 3rd phase notification issued

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By Our Business Bureau

BHUBANESWAR/JODA/KOIRA/JAJPUR: As many as 38 iron ore and manganese mines along will be auctioned in Odisha by the end of the expiry of lease period by March 31, 2020.

Besides, 2 mines has been kept for State Government PSUs.The Naveen Patnaik led Government , which had notified for auction of 20  mines in two phases, has in third phase issued notification for 9 more mining block.

This was the third notification in last 15 days. The blocks, which would go under the hammer include seven iron ore, one each iron ore and manganese and manganese block. Purheibahal, Chandiposhi, Rengalaberha North-East, Gandhalpahar and Jumka Pathriposhi are the iron ore blocks put on auction while Kalimati is the manganese block, said the notification. Unchabali iron ore and manganese block would also be auctioned. Interested bidders can purchase the tender documents till November 29 while December 4 is the last date for submission of bid . Rs 5 lakh for others while 2 lakh for manganese for tender papers.

Meanwhile, five iron ore blocks are set aside for end user industries, the remaining 15 are earmarked for bidding by merchant miners. Steel players, sponge iron ore producers, pellet manufacturers and pig iron makers along with leading merchant miners are anticipated to bid aggressively for these blocks and place steep premiums to acquire these mines where production hopes to take off seamlessly.

The floor price is fixed at 15 per cent for iron ore blocks with deposits of up to 10 million tonnes and 25 per cent for higher quantum of deposits. Presently, Odisha has 17 operative merchant mines whose approved production capacity stands at 80 million tonnes. The leases whose tenure ceases by March 31, 2020 include the ones in the leasehold of major non-captive producers like Serajuddin, Essel Mining & Industries Ltd, KJS Ahluwalia and others.

Plans are afoot to extend the environment clearance of these mines by two more years to facilitate seamless transfer of ownership and unhindered production. Since forest clearance is co-terminus with the lease validity and cannot be extended as per existing statutes, an amendment is in the works on the Forest (Conservation) Act. The Union ministries of mines, law as well as environment, forest & climate change are holding mutual consultations in this connection.

In two phases, the state steel & mines department has issued Notice Inviting Tenders (NITs) to auction 20 blocks on October 4 and 14. After issue of NITs, the bids are set to be invited on November 18 and 28. Letters of Intent (LoIs) to the preferred bidders will be issued on January 3 and 15, 2020.

Recently, the Union Mines Ministry after due scrutiny has heeded the state government’s call to hike the ceiling on lease area for iron ore and associated minerals to 58 square kilometres (sq km).Odisha is the largest producer of the steel making ingredient, producing 114 million tonnes (mt) in FY19, accounting for more than 50 per cent of the nationwide iron ore output of 207 mt.

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