The Centre, in March this year, had decided to allocate the Karlapat deposits to the state run miner following a request from the state government to reserve the mines in favour of the PSU.
"We would soon make a recommendation to the Union mines ministry to grant ML in favour of OMC. The prospecting license (PL) is not necessary in case of Karlapat bauxite mines since prospecting has already been done by the Geological Survey of India," said a highly placed government official.
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The state government had moved the ministry in June 2013, seeking the Karlapat deposits in OMC's favour, stating that it will be in the interest of mineral conservation and prudent exploitation.
The Karlapat bauxite mines spread over 3,002.49 hectares has estimated reserves of 207 million tonne which includes 153 tonne proven reserve and 54 million tonne probable reserve. The state government had sought reservation of the bauxite mines for 30 years, arguing that it will ensure fair and equitable distribution of the raw material.
Besides, the government felt such an arrangement will help accrue more economic returns for the state by way of royalty, taxes and dividend, thereby providing more funds for developmental activities. OMC securing the Karlapat mines has offered a glimmer of hope to Vedanta Ltd's alumina refinery at Lanjigarh.
The one million tonne refinery without any raw material linkages was continuing operations at a low capacity on bauxite sourced from Gujarat and Chattisgarh and also imports from nations like New Guinea. OMC had entered into an agreement with Vedanta for supplying 150 million tonne of bauxite for the Lanjigarh refinery.
The attempts to supply bauxite from the Niyamgiri deposits to the Vedanta alumina refinery were thwarted with the Union ministry of environment and forest (MoEF) withdrawing the clearances to the mining project, a decision which was later endorsed by the local gram sabhas convened on the direction of the Supreme Court.