 "Goa iron ore auction early next month")
Following the Supreme Court order in November 2013, the Goa government is gearing up to auction one million tonnes of iron ore seized from mines as part of action on illegal mining. The apex court had allowed the government to sell one million tonnes of low-grade iron ore through e-auction in February.
The Goa government came out with an official Gazette on Tuesday, allowing public-sector online service provider MSTC to train prospective bidders and interested parties in e-auction.
While the government has not declared any potential date of auction, industry players say the process will begin in the first week of February. While there will be stiff competition in bidding as several steel companies had in the past declared their intension to bid for Goa ore, fully knowing it is low-quality ore, JSW Steel is planning to bid for the full quantity (about one million tonnes) of iron ore to feed its Dolbi plant in Alibaug, Maharashtra. The firm is eagerly awaiting the proposed e-auction to start for participation.
JSW requires around 30 million tonnes of iron ore to feed its 14-million tonnes steel production capacity, of which it procures 1.5 million tonnes from every nook and corner of India. Lack of raw material had reduced JSW's overall operating capacity to 60 per cent last year
"We will be actively participating in the e-auction to feed our Dolbi plant in Alibaug. Being port-based, iron ore supply from Goa to Dolbi plant would work out cheaper than obtaining supply from anywhere else through the land route. Hence, we are looking at the auction to begin for bidding," said a senior company official.
Leading miners, including Sesa Mining Corporation and V M Salgaoncar, are set to sell 150,701 tonnes and 145,923 tonnes of low-grade iron ore, respectively, through e-auction. Sesa Goa is set to offer the highest quantity of 280,152 tonnes through online sale.
Meanwhile, about 150 miners and industry players participated in the MSTC-organised training programme on Thursday.
JSW, however, will face stiff competition from local exporters who have run out of business over the past year owing to mining restrictions in the state. Because iron-ore prices in the overseas markets rose sharply during this period, exporters would like to participate in the auction as the bid is open for both domestic steel mills and exporters.
"Exporters will also take the opportunity to do some business after over one year. Hence, the competition between local users and exporters is expected to be stiff," said Haresh Melwani, chief executive of H L Nathurmal & Co, a Goa-based miner and exporter.
A minimum lot size will be preferably of 50,000 tonnes. However, smaller lots shall be offered in quantities as they are available. The bidders shall be permitted to bid in multiples/units of 10,000 tonnes or the lot size.
In case one lot has more than one bidder due to partial bidding the allotment priority for lifting, the material shall be issued first to one who has the largest quantity offer that has been accepted. The auction price will be exclusive of royalty and other prevailing duties, said S Shridhar, former president of Goa Mineral Ore Exporters Association (GMOEA).
A recent Citi report said that the Supreme Court in November 2013 had allowed auction of 11.5 mt of already-extracted ore in Goa under supervision of an Appointed Committee. Proceeds are to be kept in fixed deposits till the SC decides on the legality of the mines.
The Goa government came out with an official Gazette on Tuesday, allowing public-sector online service provider MSTC to train prospective bidders and interested parties in e-auction.
While the government has not declared any potential date of auction, industry players say the process will begin in the first week of February. While there will be stiff competition in bidding as several steel companies had in the past declared their intension to bid for Goa ore, fully knowing it is low-quality ore, JSW Steel is planning to bid for the full quantity (about one million tonnes) of iron ore to feed its Dolbi plant in Alibaug, Maharashtra. The firm is eagerly awaiting the proposed e-auction to start for participation.
JSW requires around 30 million tonnes of iron ore to feed its 14-million tonnes steel production capacity, of which it procures 1.5 million tonnes from every nook and corner of India. Lack of raw material had reduced JSW's overall operating capacity to 60 per cent last year
"We will be actively participating in the e-auction to feed our Dolbi plant in Alibaug. Being port-based, iron ore supply from Goa to Dolbi plant would work out cheaper than obtaining supply from anywhere else through the land route. Hence, we are looking at the auction to begin for bidding," said a senior company official.
Leading miners, including Sesa Mining Corporation and V M Salgaoncar, are set to sell 150,701 tonnes and 145,923 tonnes of low-grade iron ore, respectively, through e-auction. Sesa Goa is set to offer the highest quantity of 280,152 tonnes through online sale.
Meanwhile, about 150 miners and industry players participated in the MSTC-organised training programme on Thursday.
JSW, however, will face stiff competition from local exporters who have run out of business over the past year owing to mining restrictions in the state. Because iron-ore prices in the overseas markets rose sharply during this period, exporters would like to participate in the auction as the bid is open for both domestic steel mills and exporters.
"Exporters will also take the opportunity to do some business after over one year. Hence, the competition between local users and exporters is expected to be stiff," said Haresh Melwani, chief executive of H L Nathurmal & Co, a Goa-based miner and exporter.
A minimum lot size will be preferably of 50,000 tonnes. However, smaller lots shall be offered in quantities as they are available. The bidders shall be permitted to bid in multiples/units of 10,000 tonnes or the lot size.
In case one lot has more than one bidder due to partial bidding the allotment priority for lifting, the material shall be issued first to one who has the largest quantity offer that has been accepted. The auction price will be exclusive of royalty and other prevailing duties, said S Shridhar, former president of Goa Mineral Ore Exporters Association (GMOEA).
A recent Citi report said that the Supreme Court in November 2013 had allowed auction of 11.5 mt of already-extracted ore in Goa under supervision of an Appointed Committee. Proceeds are to be kept in fixed deposits till the SC decides on the legality of the mines.