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KIOCL Ltd, the public sector iron ore miner and 100 per cent export-oriented unit, which has been moving pillar and post in both, state and central governments for the allotment of captive iron ore mines for the last eight years, has found fresh support from its employees’ union for its cause.
Kurdremukh Shram Shakti Sanghatan (KSSS), KIOCL Ltd’s recognised trade union in Mangalore and Kudremukh, has expressed solidarity with its management in securing iron ore mines. The union has submitted a memorandum to Karnataka Chief Minister Siddaramaiah to allot captive iron ore mines in the state of Karnataka, where the company has been operating since its establishment in 1969.
The representatives of KSSS, along with member of legislative council, Ivan D'Souza met the chief minister earlier this week and explained the problems faced by the company in securing iron ore for its pellet plant. KIOCL has been facing an acute shortage of iron ore ever since it shut down mining at Kudremukh in 2006 due to environment reasons, following the Supreme Court order. The company is operating its pellet plant and blast furnace units at its Mangalore plant with iron ore sourced from NMDC mines in Chhattisgarh.
After the closure of mines, the company had made an application to the state government for allotment of captive mines in the Ramanadurga region of Bellary district.
“The sanction of iron ore mines in Karnataka to the company will certainly boost the conditions thereby and prevent huge job losses in the company,” D'Souza told the chief minister.
The chief minister has assured the union members that he would consider their demand and take suitable action.
KIOCL owns a 3.5 million tonne per annum pellet plant at Mangalore and is presently utilising only 50 per cent of the capacity due to shortage of iron ore. Being a 100 per cent export-oriented unit, the company was initially barred from participating in e-auctions in Karnataka. Since then, it stopped exports and occasionally participates in the e-auction.
“Whenever we participate in Karnataka’s e-auctions, the prices go up, making it unviable for us to buy the ore. So we are dependent on iron ore from Chhattisgarh, which is transported through ships and railway to our plant in Mangalore at a very high cost,” said Malay Chatterjee, chairman and managing director, KIOCL.
Chatterjee recently met Union minister for mines Narendra Singh Tomar and requested him to consider the allocation of mining leases pending with various state governments and also consider a captive mine on urgent basis which would go a long way in rejuvenation of the company.
The imposition of distance-based charge by the railways, along with export duty, has taken a huge toll on its export opportunities. The company reported a net profit of Rs 40 crore during 2013-14 as against Rs 32 crore in the previous year. It produced 1.7 million tonnes and sold 1.6 million tonnes of pellets in FY14.
