Wednesday, 08 Feb 2012
Iron ore miners and consumers in Karnataka, including NMDC, the country's largest iron ore producer and JSW, India's largest private sector steelmaker, will have to grapple with higher costs and lower production if the Supreme Court accepts the recommendations of a panel set up to probe illegal mining in the state.
NMDC and JSW may have to pay a higher price for iron ore while other smaller and regional players, such as Mysore Minerals and MSPL, may lose some mines.
In a series of sweeping and unprecedented recommendations, the Central Empowered Committee has recommended the cancellation of 49 licences and proposed capping the state's annual production at 30 million tonnes. It has said even captive iron ore will be sold at market rates and called for all ore, from old mines as well as new, to be auctioned. But the silver lining for steelmakers will be the opportunity to grab leases when they are auctioned after cancellation.
JSW will henceforth have to buy ore at market rates even from the Thimmappangudi mine, in which it has 70% share. State run Mysore Minerals, which has supply arrangements with Mukand and Kalyani Steel, will lose a mine and will have to excavate the remaining five iron ore blocks on its own.
NMDC in addition to being penalised will lose 10% of its revenue towards a mining infrastructure development fund. MSPL, despite its long public crusade against illegal mining during the Reddy brothers' raj, will also lose one of its five mines.
Sesa Goa's plans to enhance capacity to 10 million tonnes per annum in Chitradurga will be curtailed as the limit for the Chitradurga/Tumkur district has been fixed at 5 million tonnes per annum.
The Supreme Court, which has accepted all of the CEC's recommendations so far, is likely to hear the matter again on Friday.
(Sourced from ET)
Subscribe to:
Post Comments (Atom)
Posts
No comments:
Post a Comment