Centre rejects Odisha plea for Khandadhar mines to Posco

Odisha Sun Times Bureau
New Delhi/Bhubaneswar, Apr 9:

The Union Government has rejected the Odisha Government’s request grant prospecting  license (PL) to Korean steel major Posco for its proposed $12 billion mega steel plant near Paradip.

“We had requested the Centre to treat Posco as a special case and grant it prospecting license. But the Ccentre has rejected our request. It has made it clear that Posco, like others, has to take part in the open auction to get Khandadhar or any other mines,” Steel and Mines minister Prafulla Mallick said today.

Asked if the state government would make a fresh request to the Centre to reconsider its decision, the minister said it would take a call on the matter after discussing the Centre’s response.

In his reply to Chief Minister Naveen Patnaik’s letter written last month requesting the Centre to exempt Posco from the auction process in view of the commitments made to the company both by the Centra and Odisha government, Union Steel and Mines minister Narendra Singh Tomar has said all mines will be auctioned as per the amendment to the MMDR Act passed by Parliament recently, sources privy to the communication said.

While thanking Patnaik for his support for the amendment, Tomar has said it is not possible to concede the request for exempting Posco from auction under the provisions of the amended MMDR Act and hence the company has to participate in the auction for mines like others, the sources said.

Tomar’s letter is a mere reiteration of what he had already said on February 5.

“Even I will have to bid to get a mining lease,” Tomar had said while responding to a specific query on Posco.

It may be noted that Posco was previously promised the Khandadhar iron ore mine by the state government for its mega steel plant but the actual allocation never happened due to claims by other players and delays in regulatory approvals.

Now, after the rejection of the state government’s special request, Posco will have to bid in the upcoming auction to get an iron ore mine for its $12 billion steel project as per the MMDR Amendment Ordinance 2015 that provides for allocation of all mines only through the auction route.