SC panel recommends cap on Karnataka ore mining

Wants cancellation of 49 iron ore leases, penalties on others

The panel appointed a year earlier by the Supreme Court to probe illegal mining in Karnataka has made several recommendations in its final report, with far-reaching implications. The final report was given to the SC on Friday.

The Central Empowered Committee (CEC) attached to the forest bench of the SC was given the responsibility. The bench has its next hearing in the case on Friday. The CEC was created by SC order in February 2002. It has six members at present; the chairman is P V Jayakrishnan, a retired Secretary to the Union government.

The panel has recommended cancelling 49 iron ore mining leases, fixing a cap on annual production of ore at 30 million tonnes and a halt on issue of new mining licences in Karnataka, among others.
 

STEAL SCAN 
Work by the panel appointed by Supreme Court to probe illegal mining in Karnataka

• Team surveyed 166 mining leases in Karnataka and found illegality in 123
• Area under illegal mining over three districts was 1,723.6 hectares
• Panel classifies mining leases into Category A (legal or with minor violations), Category B (illegal mining to the extent of up to 10 per cent outside sanctioned lease area) and Category C (illegal mining of over 10-15 per cent outside lease areas)
• Category A has 45 leases, Category B has 72 and C has 49
• Has recommended cap on iron ore production at 25 mt in Bellary and five mt in Chitradurga and Tumkur districts combined
• Also, halt to issue of fresh leases, including those for which notifications have already been issued without SC permission
• Ore to be sold only via e-auction
• Penalty of Rs 5 crore for pits outside lease area and Rs 1 crore for overburden dumps outside sanctioned lease area

Several big-ticket investment proposals in the steel sector may be stalled in Karnataka if the SC accepts the recommendations. While JSW Steel is in the process of expanding its capacity in the state from 10 million tonnes per annum to 16 mtpa, there are about a dozen proposals waiting for allotment of captive mines that include those of ArcelorMittal, Posco, Bhushan Steel, Surya Roshni and Tata Metaliks, among others. The state government has already recommended to the Centre on mining leases for ArcelorMittal and Posco. At the state government-organsed Global Investors Meet in 2010, memoranda of understanding were signed for investment of Rs 256,000 crore in the steel sector alone.

After its appointment in February last year, the CEC gave interim reports in April, July and September. The SC issued orders based on the findings in April, May and July, barring all mining and transportation of ore in the state. In between, the court also asked the Indian Council of Forestry Research and Education (ICFRE), with the help of the Wildlife Institute of India and the Forest Survey of India to survey the affected area and recommend on what to do; their reports were given in November and December. All this is a sequel to a public interest suit filed in 2009 on illegal mining in the state, based on the state Lokayukta’s report on the subject in late 2008. Chief minister B S Yeddyurappa was forced to quit in July 2011 after the final report on the subject by the Lokayukta.

Highlights
CEC has accepted a majority of the recommendations made by the ICFRE team, which had found massive illegal mining and transportation of iron ore in the state, by several mine owners. It has classified the mining leases into three categories — A, B and C. Survey sketches for leases on the boundary between Karnataka and Andhra Pradesh have not been finalised.

Category A comprises working leases wherein no or marginal illegality was found and non-working leases wherein no marginal illegalities were found. Their number comes to 21 and 24, respectively. These are owned by NMDC, Mineral Enterprises Ltd and Mysore Minerals Ltd, among others.

Category B comprises leases wherein illegalities by way of mining pits outside the sanctioned lease area were found up to 10 per cent of the lease areas and overburden waste dumps outside the sanctioned lease areas up to 15 per cent of the latter. The number of such leases is 72 and these, it says, may be permitted to resume mining only after paying a penalty to be fixed by the court. They include those of Sesa Goa, MSPL, Sandur Manganese and Iron Ores Ltd, and of Mysore Minerals Ltd.

Category C comprises leases wherein illegal mining by way of pits outside the sanctioned lease area have been found to be more than 10 per cent of the latter, and overburden waste dumps outside the sanctioned lease areas, of more than 15 per cent of the latter area. These, flagrantly violating the Forest (Conservation) Act, are 49 in all. These have been recommended for both, penalty and cancellation. Among the parties named here are Canara Minerals, Associated Mining, Trident Minerals, Deccan Mining Syndicate (P) Ltd and V S Lad & Sons. The survey team appointed by the apex court found 83 leases involved in illegal mining in Bellary district, 16 in Chitradurga and 24 in Tumkurs. It also found 16 leases not involved in illegal mining in Bellary, with another two and one lease, respectively in this category, in Chitradurga and Tumkur. There were 18 non-working leases without any illegalities in Bellary and six in Chitradurga. The total area under illegal mining, across the districts, was 1,723.63 hectares.

CEC has accepted ICFRE’s recommendations for a district-wise ceiling on the annual production of iron ore. ICFRE had recommended a cap of 25 million tonnes from all leases in Bellary and five mt in Chitradurga and Tumkur together. CEC also feels a cap must be put on the output from each lease. It also recommended continuation of sale of ore through e-auction via the monitoring committee, a penalty of Rs 5 crore for mining pits outside the lease area and Rs 1 crore for overburden dumps outside the sanctioned area.