The South Korean Steel giant, POSCO has been tussling for India’s proposed USD 12 billion Odisha steel project since many years. A new challenge has arrived infront of the company as the central government has refused to allot the Khandadhar Iron ore mines outside the auction route mandated by the new MMDR Act, 2015.
The Ministry of Steel & Mines has rejected the appeal of state government for allotment of mines to POSCO-India and clarified that the Khandadhar mines will be put for e-auction under the MMDR Act, 2015. This indicates that POSCO will have to bear auction expenses along with additional contribution of upto 100% royalty that goes to the states towards the District Mineral Foundation to grab the mine.
The major issue faced by the company is that it hasn’t obtained a PL for the area concerned. The application for a PL has been pending with the central government for a while. Earlier, Naveen Patnaik, Odisha chief minister, had written to PM Narendra Modi to intervene in the matter to facilitate the 12 MnT steel unit.
As per the sources, Union Mines Minister, Narendra Singh Tomar has informed Mr. Patnaik that Korean major’s application for the Khandadhar mines has become ineligible under the new MMDR Act.
Mr. Tomar has quoted in his letter to the Chief Minister, “For facilitation of setting up of a steel complex by Posco-India can only be done in the present ambit of prevailing Act & Rules.”
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