Orissa to renew MoU with Posco shortly, Okays go ahead to Korean Co for Paradip plant

30 Oct, 2011 |ET Bureau

BHUBANESWAR: Orissa government will soon renew the MoU with South Korean steel major, Posco for a 12-mtpa steel mill near Paradeep in Jagatsinghpur district.

The draft MoU is presently being fine-tuned, chief secretary Bijoy Patnaik said here adding that the 2,000 acres of land cleared by the state government for the mega-project near Paradip would be handed over to the Korean company at the time of renewal of the MOU.

The Law Department is studying certain controversial clauses in the expired MoU like ore swapping and the MMDR Act. Posco-India had already submitted its views on the controversial export clause in the previous MoU.

"Posco-India's views on the export clause are being examined by the law, steel and mines departments. The provisions of the MMDR need to be in accordance with the content of the revised MoU," he said.

Posco, in its previous MoU signed in 2005, had wanted about 4,000 acre to set up the plant at an investment of Rs 52,000 crore.

Incidentally, the state government had earlier made it clear that the Posco, can start work at the proposed plant site near Paradip before signing fresh MoU with the state, "Work for the steel project and processing of the MoU can go simultaneously," said Mr Patnaik, remarked "We will talk to Posco-India over the matter relating to beginning of the work at the proposed plant site areas under Ersama block in Jagatsinghpur district," he said.

However, the company has to agree to begin the work on the 12 mtpa mega steel plant before entering into any formal MoU, an official at the steel and mines department said.

Meanwhile, the state has overshot its mining revenue collection target in the April to September period of 2011-12. As against the targeted Rs 1,750 crore, the actual collection was Rs 2,241.29 crore. This is 51.8% higher than Rs 1,476.42 crore recorded in the corresponding period of 2010-11.

Mining revenue collection has been buoyed by higher sales realization. Under reporting of ore prices, especially iron ore has been curbed to a large extent and now our prices compare favorably with pan India average, according to the mining department officials.

(sourced Economics Times)