Iron ore miner has been functioning without captive mines for five years.
The ministry of steel has asked the government of Karnataka to expedite the process of granting new iron ore mining lease to public sector KIOCL Limited. The company has made an application with the state government for allotment of new mining lease in Ramanadurga region of Bellary district.
Virbhadra Singh, minister of steel, who inaugurated the joint operation wing for establishment of mining and value addition projects in Karnataka by KIOCL Ltd and Rashtriya Ispat Nigam Limited (RINL) for mining and value addition, here today, said the state government should address the issue on top priority.
“It does not make sense to be in the state of Karnataka which is home to iron ore deposits, and stay without producing steel. Depriving iron ore mines to KIOCL means social injustice. The government should take some action immediately in this regard,” he said.
KIOCL has been functioning without captive iron ore mines for the past five years. It stopped mining in eco-sensitive Kudremukh area from January 1, 2006, following a Supreme Court verdict.
“It is very essential for the company to have its own captive iron ore mines to achieve its ambitious expansion plans. It will be difficult for them to sustain expansion programmes without the captive mines,” Singh said.
He said, a number of letters have been written to chief minister of Karnataka B S Yeddyurappa and he has shown concern for the company and promised to take action at the earliest. The entire matter should be solved very quickly, he said.
The coming together of KIOCL and RINL is a move in the right direction. Both companies do not have captive mines. They should carry out value-added products business using in-house technology and achieve the desired goals, he said.
Later, the minister told reporters, the capacity expansion in the steel sector will be achieved by the end of 2012 and the capacity will rise to 120 million tonnes from the present 64 million tonnes. The Steel Authority of India and RINL are spending Rs 70,000 crore and Rs 20,000 crore respectively to expand and modernise their steel plants, he added.
RINL’s steel making capacity will be increased to 7.3 million tonne per annum from the present 3 million tonnes per annum by end of 2011 at a cost of Rs 20,000 crore, P K Bishnoi, chairman and managing director, RINL said.
The joint operation wing of both KIOCL and RINL, to begin with, would set up a ductile iron spun pipe plant at the blast furnace unit of KIOCL at Mangalore. The 100,000 tonne per annum plant will see an investment of Rs 315 crore, K Ranganath, chairman and managing director, KIOCL said.
He said the company was also waiting for the allotment of mining lease at Ramanadurga in Bellary district by the state government. The deposits in Ramanadurga are estimated to contain close to 250 million tonnes, which would be sufficient to keep the company functional for about 30 years, he added.
