 "Vedanta in Goa: Accountant General questions legality of lease renewals")
While Vedanta has re-started iron ore mining, experts say the Accountant General’s questioning of lease renewals is a factor to be watched.
On Monday, Vedanta re-opened its Codli mine with an estimated 70 million tonnes of iron ore reserves. The government has permitted Vedanta to extract three mt from here of the 5.5 mt of overall company annual output. So, another 2.5 mt can be dug out of its other two large and four small mines in the state.
In the pre-suspension era, Vedanta used to produce seven mt of ore in the state out of the 90 mt of overall output of 98 mines. The Supreme Court has put a cap of 20 mt of overall ore output in the state, which means the remaining 97 mines would be able to produce only 14.5 mt annually.
A number of other mining companies have already gotor are in the process of getting their final clearances to resume operations but are awaiting the abatement of the monsoon.
A cloud, however, persists due to the Accountant General’s office's question over legality of mineral allocation early this year. According to informed sources, Audit Officer B Vijendra Pai wrote to Director of Mines Prasanna Acharya, seeking reasons of granting renewals of mining leases in a hurry. Pai is said to have raised questions over the legal validity of second renewals of 25 mines on January 12, the day the Mines and Minerals Development Regulation (MMDR) Amendment Act 2015 was notified. The Act ruled out second renewal of mineral leases and recommended auctions.
The directorate of mines and geology renewed 88 leases between November 2014 and January 2015 under the old MMDR Act of 1957.
“This has sparked uncertainty once again. After three years, we were hopeful of restart of mining after the monsoon. But, investors would remain hesitant for fresh investment under this environment,” said Haresh Melwani, chief executive officer, H L Nathurmal & Co, an ore miner and exporter.
Also, private mining companies are waiting for the state government to roll back some levies for making mining viable. The government levied an annual processing fee of Rs 100,000 for raising contractors and annual registration fee of Rs 50,000 for transport contracts, among others.
On Monday, Vedanta re-opened its Codli mine with an estimated 70 million tonnes of iron ore reserves. The government has permitted Vedanta to extract three mt from here of the 5.5 mt of overall company annual output. So, another 2.5 mt can be dug out of its other two large and four small mines in the state.
In the pre-suspension era, Vedanta used to produce seven mt of ore in the state out of the 90 mt of overall output of 98 mines. The Supreme Court has put a cap of 20 mt of overall ore output in the state, which means the remaining 97 mines would be able to produce only 14.5 mt annually.
Also Read
“The resumption of mining will resume the employment of many mining-dependent people, the government will benefit from increased revenues and communities will be empowered. We urge the government to resolve the issue of dumping of ore outside lease areas for Goa mining to be viable, mainly looking at falling iron ore prices,” said Kishore Kumar, chief executive officer of Vedanta’s iron ore Business.
A number of other mining companies have already gotor are in the process of getting their final clearances to resume operations but are awaiting the abatement of the monsoon.
A cloud, however, persists due to the Accountant General’s office's question over legality of mineral allocation early this year. According to informed sources, Audit Officer B Vijendra Pai wrote to Director of Mines Prasanna Acharya, seeking reasons of granting renewals of mining leases in a hurry. Pai is said to have raised questions over the legal validity of second renewals of 25 mines on January 12, the day the Mines and Minerals Development Regulation (MMDR) Amendment Act 2015 was notified. The Act ruled out second renewal of mineral leases and recommended auctions.
The directorate of mines and geology renewed 88 leases between November 2014 and January 2015 under the old MMDR Act of 1957.
“This has sparked uncertainty once again. After three years, we were hopeful of restart of mining after the monsoon. But, investors would remain hesitant for fresh investment under this environment,” said Haresh Melwani, chief executive officer, H L Nathurmal & Co, an ore miner and exporter.
Also, private mining companies are waiting for the state government to roll back some levies for making mining viable. The government levied an annual processing fee of Rs 100,000 for raising contractors and annual registration fee of Rs 50,000 for transport contracts, among others.