Working to get required nod to reopen Goa mines: Sesa Sterlite

Apr 22 2014, 21:14 IST
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SummarySesa Sterlite, the main subsidiary of mining conglomerate Vedanta, is the largest private sector iron ore producer in India.

A day after Supreme Court lifted its ban on mining ban in Goa, Sesa Sterlite, India's biggest zinc and aluminum maker, today said it is working to secure necessary permission for re-opening its mines in the state.

In a statement, the Vedanta Group firm said that the apex court has held that all mining leases in Goa, including those of Sesa Sterlite, have expired in 2007 and hence, no mining operations can be carried out until renewal/execution of mining lease deeds by the State government.

"The company is working towards securing the necessary permissions for commencement of operations at the earliest," it added.

Yesterday, the apex court had lifted its 18-month long mining ban in Goa with several conditions and had capped the annual production of iron ore at 20 million tonnes. The cap is subject to determination of final capacity by an expert committee appointed by the Supreme Court.

Sesa Sterlite, the main subsidiary of mining conglomerate Vedanta, is the largest private sector iron ore producer in India. Its iron ore business, earlier known as Sesa Goa, is based in Goa and used to produce about 15-16 million tonnes of ore prior to imposition of the ban in October, 2012.

With the ban in place, operations of company's iron ore business was virtually closed and had reported a negative earnings before interest, taxes, depreciation and amortisation of Rs 148 crore during April-December 2013.

Shares of Sesa Sterlite today fell 4.01 per cent to close at Rs 193.70 a piece on the BSE.

Meanwhile consultancy firm Deloitte, in a statement, said that the lifting of the iron ore mining ban in Goa is a positive step to restore confidence in the mining sector.

"The industry has taken a big hit in the recent past due to the ban and restoring mining operations will bring a much sought relief to the players and is likely to help in a gradual recovery of the sector," said Kalpana Jain, Senior Direcor of Deloitte in India.

She added that by putting a cap on production, an equally important message has been conveyed that tolerance for illegal activities is declining and there is a need to be conscious of regulatory and environmental matters.

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