The government will soon float tenders to offer the blocks for auction with a target to start operations by August 8, of the already producing mines.
The Odisha government will offer 16 more iron ore blocks for auction, of which 10 are already producing. The government will soon float tenders to offer the blocks for auction with a target to start operations by August 8, of the already producing mines, said Deepak Mohanty, special secretary, department of steel and mines.
The lease period of the producing mines have got over and the government without any delay wants operation of such mines to be resumed with a view to boost supplies of iron ore, supposedly short. ” Our government is also trying to bring the expired mines into operations ,” Mohanty said. This is being done with a view to increase supplies in the market to alleviate any shortage of iron ore by the end of this fiscal.
Odisha Mining Corporation (OMC) produced 12.4 million tonne (MT) in FY20, 12.7 MT in FY21 and has a target to produce 30 MT in FY22. T company aims to produce 60 MT by FY 26, Mohanty said.
The state auctioned all the 24 mines in FY21 whose lease got expired. As on date ,19 of the 24 auctioned mines have already started operation and production.
Steel production in Odisha in FY21 went up by 4.38% but the country is still short of its target. India will need to double its iron ore mining capacity by 2030 to meet the demand as per the national steel policy 2017. Growth in infrastructure, power, and cement industries and attractive opportunities arising out of the the PLI scheme, policy support for MSMEs and others are driving the steel demand, VK Sarswat, member, Niti Aayog had said at an ICC session.
Domestic production has gone up by 13% in last 5 years from 129 MT in 2015 to 206 MT in 2019, registering a CAGR of 12.4%. Consumption has gone up from 115 MT in FY15 to 160 MT in FY19. But the sector continues to face challenges in cost competitiveness, high royalty and low import duty, Sarswat said, adding that even after three years of the auction process, no large mine has been able to commence production. Only 3 out of the 53 mines auctioned have commenced production.
However, despite persisting issues with coking coal, logistics, land acquisition, increased requirement for consent, increase in compensation and non upgradation of technology, India is expected to produce one-fifth of the world’s total steel production by 2050. India, already the world’s second-largest steel producer, is also expected to increase its annual production twice than that of Europe by that period.