Despite plummeting global prices of iron ore, Anil Agarwal-promoted Vedanta is set to reopen its mines in Goa next week...
Despite plummeting global prices of iron ore, Anil Agarwal-promoted Vedanta is set to reopen its mines in Goa
next week, ending a three-year impasse following the Supreme Court-imposed ban on mining of ore in the state. The company is hoping to regain trust of its buyers from China and Japan.
The reopening of its largest mine, Codli, in the presence of state chief minister Laxmikant Parsekar on August 10, could potentially not only Vedanta but also the tiny coastal state, which used to be the country’s largest iron ore exporter.
Resumption of mining would also produce jobs for mining workers, barge owners, transporters while the state exchequer will get a boost from tax and royalty proceeds. Codli mine has 3 mtpa production capacity.
After ordering a ban on mining in all 90 mines in Goa on the basis of the Justice MB Shah commission report on illegal mining, the Supreme Court had partially lifted the ban in April 2014 but put a cap on annual production at 20 million tonne (mt).
Vedanta currently has the permission to mine 5.5 mt iron ore annually and is the largest miner in Goa. It is restarting the business with the hope to meet its fixed costs and use the idle workforce. The company is confident of producing the entire permitted capacity in the remaining period of the current fiscal.
For the time being, the Anil Agarwal-led mining conglomerate seems to be the only company to restart mining in the state, though industry sources said that VM Salgaocar group is also looking to restart its mines post- monsoon.