Mines Ministry notifies rule to allow transfer of rights after change in company ownership
ArcelorMittal Nippon Steel (AM/NS) has been granted a 50 year mining lease to the Ghoraburhani-Sagasahi (Sagasahi) iron ore block. The company has clearance for a 7.16 mn t pa mining operation from this 99.59 mn t iron ore deposit spread over an area of 139.165 hectare in Sundergarh district in Odisha.
It has taken more than five years for the project – the first greenfield block to be auctioned in the country after mining laws were changed in 2015 – to get all the required statutory clearances including a stage II forest clearance. During the period the bankrupt Essar Steel was acquired by the AM/NS, a JV created specifically for this purpose. AM/NS which now also owns the Thakurani deposit (8mtpa) expects to reach its EC limit of 7.16 mn t pa before five years.
In 2006 soon after Sagasahi was auctioned, Odisha had also auctioned two other iron ore deposits – Kalmong West bagged by Bhushan Steel (which was later acquired by Tata Steel and renamed Tata Steel BSL) for 100.05 per cent and Netrabandha Pahar by Bhushan Power and Steel for a premium of 87.15 per cent.
Unlike Tata Steel BSL which had sought a transfer of the LoI granted to the BSL, AM/NS had pushed through on the original LoI that incidentally lapsed on Saturday.
This uncertainty — whether an LoI remained valid subsequent to a change in ownership of the company — has also been addressed recently. On Wednesday the Ministry of Mines notified a provision for a transfer of LoI issued through auction under the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession (Amendment) Rules, 2021.
This should pave the way for Tata Steel BSL to operationalize the 92 mn t Kalmong West iron ore mine which it has three months to get a grant for.
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