Wednesday, July 30, 2014

Odisha government to soon grant laterite deposits to Anil Agarwal's alumina project

Economic Times, July 29, 2014
BHUBANESHWAR: In what should serve as a relief for Anil Agarwal's alumina project, the Odisha government will soon grant three laterite deposits that can partially feed the company's controversial refinery in Kalahandi. Raw material uncertainty has plagued Vedanta Aluminium, now merged with Sesa Sterlite, ever since August of last year when local tribals, in a first of its kind referendum ordered by the Supreme Court, rejected the mining project. 

Laterite, with some beneficiation and combined with the bauxite the company has been forced to import or source from Gujarat, can be used input to make alumina. According to senior official in the state and the company, the government has zeroed in on three such deposits, covering an area of 140 hectares near Jaipur, in Koraput district. 

"They had 5-6 applications, and the government has approved proscpting leases for 3 deposits. This is for prospecting, it will then progress to a mining lease," said a senior government official who asked not to be named. 

A 72mt bauxite deposit atop Niyamgiri hills was to be mined by the state firm, Odisha Mining Corporation for the 1million tone refinery. Local administration is scheduled to conduct a public hearing for the expansion of this refinery, from 1million tone annual capacity to 6mt, and of its captive power plant from 75 MW to 285 MWon Wednesday. A more long term solution to the project Patnaik's though will be a captive bauxite supply mined in the vicinity. 

According to those in the know, Naveen Patnaik's government is pushing for OMC to develop the 224 mt Karlapat deposit, and the smaller 22mt deposit of Majingamali that can then supply raw material to Sesa Sterlite's aluminum project. The stat has recommended the two deposits be reserved for its PSU; The centre is yet to approve these allocations to OMC. 

Sesa Sterlite claims to have invested Rs 50,000 crore in setting up this alumina refinery and a 0.5mtpa smelter and captive 1215 MW power plant in Jharsuguda, banking on their MoU with OMC for a supply of 150 million tones of bauxite. The project has been battling opposition from both local tribals opposed to the mining, environmentalist who they claim are funded by global rivals, and Congress politicians of the former UPA government. 

Laterite, unlike bauxite, figures in the list of 'minor' industrial minerals, and its exploitation will not require central government approval. According to former state mines minister, the company has already experimented with laterite from Andhra Pradesh. 

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