By Our Correspondent
BHUBANESWAR: Penalized Mining Companies Involvement Raises Fears of Repeated Violations, Especially with 33,000 Acres of Forest, Agricultural Land at Stake in On-Going Odisha Mining Auction for 12 Minerals Blocks, Minerals Extracted rapidly, Benefiting Corporates more than Locals.
Odisha’s Minerals like iron, ore, manganese, coal, bauxites, limestone, chrome, are being extracted rapidly, benefiting corporates more than locals. Post-2020 cases include tax evasion scams like Rs 100 crore in 2024 raids.
Allegations of corporate favoritism fuel perceptions of “unholy nexus.” While auctions are transparent, end-use rules sometimes favor big players. Tribals and farmers protest land loss without adequate consent or benefits, violating Forest Rights Act in some cases.
The allowance is legal under current rules, justified by economic imperatives and post-scam reforms, but valid concerns exist about accountability and sustainability.
Allowing paid-up firms to bid is consistent with law but punishment was financial, not debarment. Barring them could invite legal challenges as discriminatory but no monitoring mechanism to check them.
Odisha plans 35+ auctions in 2026 to counter depletion concerns by ensuring sustainable extraction under monitored plans.The BJP-led Odisha government (and central authorities) frames this as economic necessity:
Mining contributes 10–15% to Odisha’s GDP. Auctions aim to generate thousands of crores in premiums/royalties, create jobs (like 870+ from recent approvals), and support steel/aluminum sectors. With global demand for iron ore and critical minerals rising, delaying auctions could hurt India’s self-reliance goals.
Post-2017, allotments shifted from “settled in private meetings” (as criticized in UPA-era scams) to mandatory auctions, reducing corruption risks. Penalties recovered funds for the state, and new leases include strict environmental safeguards (like rehabilitation funds).
Auctions are transparent (e-bids, no discretion), with the state approving winners based on highest premium bids (revenue share to government). Post-auction, lessees must adhere to the Odisha Minerals (Prevention of Illegal Mining) Rules, 2025, including e-permits for transport to curb manipulation.
In October 2025, the Union Mines Ministry notified penalties for delays in operationalizing won blocks (like fines for not seeking clearances promptly). It’s considering blacklisting 50 “laggard” companies from past auctions that haven’t started mining, but this targets inaction, . Discussions are ongoing for stricter criteria favoring “renowned” firms, but nothing finalized yet.
There is no explicit rule barring companies that paid past penalties from new auctions. The Supreme Court’s 2017 order focused on compensation for historical violations, not permanent exclusion. Once fines are settled and companies obtain fresh clearances (like from MoEFCC for environment/forest), they can participate. This is seen as aligning with “ease of doing business” reforms.
JSW Steel, Tata Steel, Vedanta, Serajuddin Mines, AMNS, Kashiv Group of Companies, and Essar Minmet, all previously penalized—have bid on the 2026 blocks. Few others heavily fined in 2021) isn’t listed in bids but could participate in future ones if compliant.
This raises concerns about the Odisha mining sector, including past scams involving iron ore manipulation, dispatch shortfalls, and court-mandated penalties, and questions the BJP-led government’s decision to allow previously penalized companies to participate in the 2026 auction of 12 mineral blocks.
Odisha has a history of significant mining irregularities, particularly in iron and manganese ore extraction between 2000 and 2011.
The Shah Commission (appointed in 2010) and the Supreme Court-appointed Central Empowered Committee (CEC) uncovered widespread illegal mining, including extraction without environmental or forest clearances, excess production beyond approved limits, and manipulation of dispatch records (like under-reporting ore volumes to evade royalties). This led to environmental degradation, revenue losses, and what was estimated as a Rs 60,000–Rs 70,000 crore scam in Keonjhar and Sundargarh districts alone. The CEC blamed lax oversight by the state government and complicity in allowing violations.
In a landmark ruling (Common Cause vs. Union of India), the Supreme Court imposed a 100% penalty on the price of illegally extracted minerals from 2000–01 onward. This amounted to over Rs 17,500–21,000 crore across 131 errant miners. Companies were required to pay by December 31, 2017, with 12% interest on delays. The court also directed the state to recover dues, revise mining plans, and set up an expert panel to prevent future lapses. No CBI probe was ordered despite recommendations, focusing instead on compensation and reforms.
The High Court has handled related cases, such as quashing excessive penalties in some instances (like a 2025 case where it set aside a Rs 96 crore National Green Tribunal fine on a miner for being “manifestly arbitrary” due to procedural issues). It has emphasized natural justice but upheld the need for strict compliance.
By 2020, many companies paid partially or fully, but over Rs 6,000 crore remained unpaid as of then. Some faced temporary mine closures (like Supreme Court ordered shutdowns in 2014). However, once penalties were settled and clearances obtained, operations resumed under tighter rules.
These issues were not unique to any one government but spanned multiple administrations, with reforms accelerating post-2014 under the amended Mines and Minerals (Development and Regulation) Act (MMDR), 1957, which mandated transparent auctions instead of discretionary allotments.
The Odisha government (under BJP since 2024) is actively auctioning mineral blocks to boost revenue, jobs, and industrial growth, aligning with national goals for self-reliance in resources.
On December 4, 2025, the Directorate of Mines and Geology issued a Notice Inviting Tenders (NIT) for 12 virgin (unmined) major mineral blocks across Sundargarh, Keonjhar, Koraput, and Nuapada districts. These include iron ore, manganese, bauxite, limestone, and dolomite. Bids closed on February 3, 2026, with technical evaluations ongoing. This is the second tranche after eight blocks were auctioned in 2025.
Bids were received for 11 of 12 blocks (no bids for Garramura limestone in Nuapada due to its small size and limited reserves).
Key blocks: Iron ore: Alaghat West (Sundargarh), Rengalaberha North-East Extension (Keonjhar), Nuagan West (Keonjhar), Thakurani-A1, etc. Manganese: Kutinga, Patamunda-A, Jajang-A. Bauxite: Tarhapani (West) and Karnapodikonda (Koraput).
Limestone/Dolomite: Telipadar-Lukapada-Pipalmunda (Balangir), Tummura (Sundargarh).
Bidders: Over 20–22 companies per major block, including Tata Steel, JSW Steel, ArcelorMittal Nippon Steel, Vedanta, Essar Minmet, Jindal Steel, Rungta Mines Ltd, Rungta Sons Pvt Ltd, NALCO, Hindalco, and alloy/sponge iron producers. This shows strong interest from integrated steelmakers and miners.
Odisha aims to auction 35 blocks in 2026 (per the annual calendar finalized in January), including some previously mined ones with expired leases. This follows central directives for predictable auctions to secure raw materials for industries.
Under the Mineral (Auction) Rules, 2015 (amended up to 2024), auctions are open to any entity (Indian or foreign) meeting technical and financial thresholds. Key requirements:
Net worth: Varies by block size (like., Rs 100–500 crore for large blocks).
Prior mining or end-use plant operations (like, steel mills for iron ore).
No affiliates bidding on the same block. Compliance with environmental laws and no ongoing blacklisting. Bidders must submit bids via e-auction platforms like MSTC.
1) Alaghat West Iron Ore Block- District- Sundergarh, Resource- 133.40 MT @ 59.04% Fe
2) Rengalaberha North-East Extension and Nuagan West Iron Ore Block- District- Kendujhar, Resource- 37.95 MT @ 57.87% Fe.
3) Thakurani-A1 Iron Ore block- District- Keonjhar, Resource- 50.532 MT at >35% Fe cutoff.
4) Kedesala West Iron Ore Block- District- Sundergarh, Resource- 84.56 MT Iron Ore @ 55.76% Fe and 1.23 MT Aluminous Laterite @ 37.32% Al2O3.
5) Tarhapani (West) Bauxite Block- District- Koraput, Resource- 15.901 MT Bauxite @ 35.92% Al2O3 and 6.666 MT Aluminous Laterite @ 27.56% Al2O3.
6) Karnapodikonda Bauxite Block- District- Koraput, Resource- 42.397 MT Bauxite @ 44.99% Al2O3 and 4.509 MT Aluminous Laterite @ 40.48% Al2O3.
7) Kutinga Manganese Block- District- Koraput, Resource- 2.55 MT @ 20.67% Mn.
8 ) Garramura Limestone Block- District- Nuapada, Resource- 2.98 MT @ 46.63% CaO and 1.44% MgO.
9) Telipadar-Lukapada – Pipalmunda Limestone block- District- Balangir, Resource- 8.5504 MT @ 47.43% CaO and 0.561% MgO.
10) Patamunda-A Manganese block- District- Sundergarh, Resource- 6.66 MT Manganese @11.91% Mn and 0.31 MT Iron Ore @ 46.47% Fe.
11) Jajang-A Iron and Manganese Block- District- Kendujhar, Resource- 2.19 MT Manganese @ 14.68% Mn and 16.05 MT Iron Ore @50.68% Fe.
12) Tunmura Limestone & Dolomite Block- District- Sumdergarh, Resource- 4.042 MT Limestone @ 42.849% CaO and 7.437 MT Dolomite @ 26.713% CaO.
