NMDC Limited chairman and managing director Rana Som said the public sector undertaking had not exported even a "single ounce" of iron ore from its Donimalai mine in Karnataka from the end of 2008.
Whatever had been mentioned in the Karnataka Lokayukta report on NMDC about under-invoicing of its exports was incorrect. “I deny the charges in the strongest possible words," he told mediapersons here on Monday.
According to Som, NMDC had entered into export agreements with the approval of the Union cabinet and also canalised all its exports through MMTC. "Therefore, there is no question of under-invoicing of exports or siphoning of the money."
Stating that he was a "little surprised" at the charges, he said the Lokayukta institution seemed to have failed in understanding the nuances of the export agreements and international pricing of iron ore.
Like any large mining company in the world, NMDC exports ore on a long-term contract basis. Compared with long-term contracts, international spot prices of ore could be either higher or lower. For instance, the spot prices of the ore were higher than the long-term prices in 2007, but lower in 2008.
"How can you compare the long-term prices with the spot prices?" he asked.
Som, however, said he was not going to challenge the Lokayukta report. "I can only say what are the facts. It is for the ministry concerned to look into this matter. If at all there is question from the ministry, I will reply."
NMDC has just received the draft of the Cabinet approval for entering into long-term export contracts. It would forge export agreements with Japanese and South Korean steel makers once it receives the final approval.
He said NMDC would be able to export no more than 1.4 million tonnes (mt) of iron ore this financial year though it had approval to export 2.8 mt. This was on account of the company getting the necessary approval from the Centre four months after the lapse of its long-term agreements in April. Replying to a question, Som said the Lokayukta charges were unlikely to have any impact on NMDC's exports. However, the Supreme Court stalling the mining operations in Bellary and Hospet area would affect domestic steel makers.
"They (steel producers) will be impacted once the inventory of the minors that usually lasts for 10-15 days is exhausted," he said.
