Odisha Government issues ‘LoI’ to Successful Bidders for 23 Mining Blocks

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By Anurjay Dhal

BHUBANESWAR: After successfully completing the auction of 23 mines of 24 expiring by March 31, 2020 under Joda-Koira-Rairangpur-Jajpur circles of Odisha’s mineral rich Keonjhar, Sundargarh, Mayurbhanj and Jajpur with Badampahad Block held by Lal Trade Agencies Pvt Ltd under Rairangpur circle put on hold for Court case, the Naveen Patnaik led Government here has started issuing Letter of Intent(LoI) to 23 successful bidders , so that they could continue with other formalities to ensure uninterrupted mining operations in the State.

“Accordingly, pursuant to Rule 10(2) of the Auction Rules and the terms of the tender document, the Government of Odisha is issuing this ‘Letter of Intent’ (LoI) for grant of mining lease of mining lease for Roida-II for Iron Ore in Tonto and Siddhamath RF villages of Keonjhar district over 74.702 hectare area to Narbheram Power and Steel Pvt Ltd of Kolkata based Atha Group. for a period of 50 years,” a Government circular issued by Joint Secretary Manjulata Swain, in favour of KN Ram Mines Ltd, said.

Meanwhile, several activists in Bhubaneswar alleged about irregular, conspiracy-driven iron ore auctions as they argued that premiums crossing as high as 150% and more.“The just concluded bidding has widened abundant scale for a massive Mining Scam and the Naveen Patnaik led BJD Government has to clarify about the aggressive bidding, which will promote mining scam,” said an activist.

“The aggressive biddings with an aim to loot the Odisha’s valuable iron ore are the result of a nexus between a few Industrial Houses, close to the power corridor, political leaders, bureaucrats and Mines Contractors,” said he. This premium is a percentage of the price of the iron ore that is set by the Indian Bureau of Mines each month for different States and grades. The premium will be taken by the State.

Apart from the premium , the new owners will pay to the State Government a royalty of 15 percent of base price, DMF  fund contribution 30 percent of royalty and National Mineral Exploration Trust of 2  per cent of royalty that will be charged separately on the base price. Premium and royalty will be charged on sales of iron ore, sources added.

The high premiums will lead to illegal mining, unethical market manipulation, rate fixing and other massive mines corruption. Since many of the large companies are emerging as the winners, they will become the new price makers in the market and the ultimate burden will pass to the consumers, they alleged.

They expressed grave concern over the manipulated system of iron ore mining business in the State, urged the Government to act immediately to ensure the interest of the State and the people was protected.

The first block that had put for auction was Nuagaon mines of 792.93 MnT reserves, which was won by JSW Steel Ltd with 95.2 per cent.

Sajjan Jindal led JSW Steel had won four blocks – Nuagaon ,Narayanposhi, Ganua  and Jajang  with total ore reserve of 1,138.34 million tonnes. Sajjan’s younger brother and Congress leader Naveen Jindal owned Jindal Steel and Power Ltd Guali Iron Ore Block  by committing to pay 144% premium to Naveen Patnaik led BJD Government.

The Guali block, which was earlier reserved for State PSU, OMECL, had to put for auction in view of the MMDR Act of 2015 and Minerals (Laws) Amendments Bill-2020, which got passed in both Houses of Parliament few days back.  Guali mining lease area over 365.026 hectares and has a reserve of 183 million tonne is located in five villages namely Guali, Panduliposi, Rugudihi, Laidapada and Topadihi under Barbil of Keonjhar. ArcelorMittal India Pvt Ltd had won Thakurani iron ore block held by Ahluwalia Brothers.

Tata Steel’s subsidiary, TS Alloys bagged Sukinda Chrome Block in State’s Jajpur by committing to pay 93.7 per cent of the average sale price. PM Granite Exports Pvt Ltd bagged Kanther-Koira Manganese Block by committing to pay premium at 110.04. Kanther-Koira manganese block has an estimated reserve of 0.615 MT. Ghanshyama Misra and Sons Pvt Ltd, had retained its Gorumahisani block at a premium of 115 per cent.

Agrasen Sponge Industries Pvt Ltd  had bagged Katasahi manganese block by committing to pay 130.30 per cent of the average sale price with an estimated reserve of 0.667 MT. Jagat Janani Pvt Ltd has bagged Jururi iron ore block held by Kalinga Mining Corporation by committing to pay 126.23 per cent of the average sale price, which has an estimated reserve of 270 MT.

Tarama Apartment Pvt Ltd, a Group Company of Gurukul Homes Pvt Ltd Bagged the Teherai Iron Ore Block by committing to pay 93.06 per cent of the average sale price, which has a reserve of 8.90 MT of iron ore and 0.055 MT manganese.

 Kashvi International Pvt Ltd had bagged the Jaribahal iron ore block  by committing to pay 150 per cent of the average sale price, which spread over an area of 106.53 ha and  has an estimated iron ore reserve of 7.15 MT.

Debabrata Behera bagged Siljora-Kalimati iron ore and manganese block at 154%, the highest-quoted premium, The composite mine has an estimated reserve of 0.72 MT iron ore and 3.846 MT manganese.

Yazdani International (P) Ltd had bagged Kalmong iron ore and manganese block at a premium of 100 per cent on . Vishal LPG Fuels Pvt Ltd had bagged another composite mine, Nadidih iron ore and manganese mine in Sundargarh district.

Goa-based mining form Sociedad De Fomento Industrial Pvt Ltd bagged Nadidih iron ore block by committing to pay the average sale of 141.25 per cent. Patnaik Minerals Pvt Ltd had bagged Mahulsukha iron ore and manganese mines  at a premium of 92.70 per cent on Saturday (February 8).Kolkata-based Khatua Narbheram & Co. retained the Roida II iron ore mines at a premium of 90.90 per cent.

Shyam Ore had bagged the Jilling-Langalota iron ore block in Odisha’s Keonjhar district by committing to pay 135 per cent of average sale price.

It may be noted here that mining sector in Odisha was badly hit over the past 6 to 7 years due to a Scam worth Rs 80,000 crore and several round of probes are going on but another Big Scam is in offing considering the high premium offered by bidders in ongoing mining bidding.

Big players like KJS Ahluwalia and Prasant Ahluwalia brothers, Essel Mining and Industries Ltd of Aditya Birla Group , the Chaibasa, Jharkhand headquarters, Rungta Mines Group, Patnaik Minerals, Kalinga Mining Corporation, RP Sao-TP Sao were among those isolated in the just conluded bidding. Ahluwalia Brothers lost 3 of their major Blocks while RML Group lost almost half dozen running mines followed by couple of blocks of EMIL. Rungta Mines Ltd Group till has 2 major Blocks under Sundargarh-Keonjhar circle , which has life span of more than 15 years while the Chaibasa based Merchant miner is eyeing on half dozen virgin mines out of 9, which will be put for auction soon.

Ahluwalia Brothers read Prasant Ahluwalia and Kamaljit Singh Ahluwalia totally rooted out from Odisha’s mining zone while Aditya Birla’s Essel Mining and Industries knocks the door of the Supreme Court to defend its lease over Jilling-Langalota Block. The Supreme Court had also put the lease transfer on hold till further order. Kolkata based Shyam Ore on had bagged the Jilling-Langalota iron ore block  by committing to pay 135 per cent of sale to the Odisha government

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