JSW Steel will be increasing production from Gonua, an iron ore mine it said it wanted to surrender last year, from 1.2 million tonnes per annum (MTPA) to 2.99 MTPA.
On 18 of May, the steelmaker will be seeking public consent from the villagers around this mine in Koira district of Sundergarh to excavate 3.4086 MTPA (with a ROM of 2.99 MTPA) and set up a screening and crushing unit of 1000 tonnes per hour over an area of 88.516 ha.
JSW Steel, Odisha’s largest iron ore producer today, seems to have changed its mind and will continue to operate and run all four of the auctioned mines it bagged in Odisha, including Gonua for which it had even prepared a final mine closure plan (FMCP).
Later in the month, the administration will conduct a similar public hearing for JSW Steel’s expansion of Narayanposhi Iron & Manganese Ore Mine, where it plans to raise production from 6 MTPA to 10 MTPA. It also has plans to raise the capacity of Nuagaon, its largest mine from 8 MTPA to 20 MTPA. The company expects to exhaust resources of the fourth deposit, Jajang, operating at a capacity of 16.5 MTPA in the next 3-4 years.
Last year, in the run up to Odisha government’s second set of auctions, the steelmaker had announced it would be surrendering two of the four mines it had bid for in 2020 raising questions about the sustainability of the high premiums fetched in early auctions. Despite these doubts, Tata Steel bid as high as 141.25 per cent for Gandhalpada iron ore block in Odisha.
Wishing to surrender Gonua, for which it was paying 132 per cent premium, the company submitted a FMCP to the Indian Bureau of Mines. It learnt in the process that the two-year closure formality included an idle period of 9 months, during which the company would continue to have to comply with its Mine Development and Production Agreement under which not producing ore has financial implications. Industry sources say the Mines Ministry at the Centre, which has legislative powers, is considering addressing these conflicting expectations.
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