Orissa govt to give Sukinda chrome surplus to OMC

Dilip Bisoi

Bhubaneswar, Aug 28: The Orissa government has decided to vest a lucrative chrome ore bearing area in Sukinda valley with Orissa Mining Corporation, instead of distributing it among the four leading ferro alloys companies that have been battling for the reserves.

The decision taken on Monday, has come as a rude shock to Jindal Strips, Ispat Alloys, Facor and IMFA/ICCL, which contested the original lease to pioneer Tata Iron & Steel Company in the hope of getting something.

The government has overturned the recommendations of a committee appointed by it, and said the surplus 436 hectares of chrome ore mining area will be vested with the state-owned OMC.

The four ferro alloys companies had fought a fierce legal battle in the 1990s against the lease granted to Tisco to retrieve 855 ha of chrome ore mines area. Chromium, derived from the ore, is a vital input in steel-making.

They had succeeded in getting the lease for around 419 ha out of the 855 ha during the JB Patnaik government’s rule.

Then, the government recommended the lease of 84 ha of mines area in favour of Nav Bharat Ferro Alloys, which has set up a plant in the state.

The four ferro alloys companies wanted the remaining 436 ha also distributed among them. They had also sought the cancellation of the lease in favour of Nav Bharat Ferro Alloys, claiming that the Sharma Committee, whose recommendations have been accepted by the Supreme Court, has suggested that the surplus be distributed among the four companies that had contested the case against Tisco.

However, the government set up a committee under the then steel and mines secretary, Mr HS Chahar, to recommend a proper method of distributing the surplus 311 ha of chrome ore mining areas. (After the distribution of mining area among the five ferro alloys companies in the first phase, the government had 351 ha left over, of which 40 ha was found non-mineral area.)

In July this year, the Chahar committee recommended the distribution of about 278 ha of chrome ore mines out of the surplus 311 ha to six ferro alloys companies — IMFA/ICCL, Jindal Strips, Ispat Alloys, Facor, Nav Bharat Ferro Alloys Corp and Vasvi Industries — while reserving 33 ha to meet future requirement of the industries.

Sources in the government told The Financial Express that the committee had recommended the lease of 88.098 ha to IMFA/ICCL, 44.162ha to Ispat Alloys, 17.837ha to Facor, 39.742ha to Jindal Strips, 44.460ha to Nav Bharat Ferro Alloys and 43.879ha to Vasvi Industries of Hyderabad.

However, the government has rejected the Chahar committee recommendations and decided to transfer the surplus mines to OMC. It also decided to cancel the sanction of 84 ha mining lease in favour of Nav Bharat Ferro Alloys Corp. Private companies without chrome ore mine lease will have to get their supply from the OMC, chief secretary DP Bagchi said.