The fate of 15 mnt of iron ore in Odisha will now be decided next Wednesday or on 11 November 2020 when the High Court of Orissa considers a request for extension from half a dozen old lessees in the state.
Unable to evacuate their material before 31 Oct 2020, companies such as KJS Ahluwalia, Serajuddin, AMTC, Ghanshyam Misra and RP Sao had cited Covid19 to invoke a “force majeure” clause in their lease contracts.
They had moved court to seek additional time pre-empting the Supreme Court’s decision on a similar plea from miners in Goa. However, they now hope to benefit from the apex court’s 13 October 2020 order (in the matter of Chowgule and Co Pvt Ltd vs Goa Foundation) granting Goa’s miners time until January to despatch royalty-paid ore.
The Odisha matter was to be heard yesterday but has been deferred by a week due to the unavailability of the Chief Justice.
More than one official told SteelMint that about 15 mnt of largely low grade material extracted by the old lessee was found at mine sites as on 1 November 2020. Serajuddin – despite the fact that it reclaimed rights to its mine auctioned earlier this year – is left with about 8mnt produced under its earlier lease. KJS Ahluwalia with 3mnt.
This preliminary estimate has been arrived at by the state’s officials who have spent that last few days in Joda and Barbil taking stock of the remaining ore which is to be auctioned by state-owned PSU Orissa Mining Corporation.
How soon this happens though may depend on the final verdict of the High Court. The state government however is not waiting. Internal documents reviewed by SteelMint suggest it intends to argue that unlike the Goan government it moved in time to confiscate the material as provided for under the law.
Patnaik’s government has been chasing new lessees to ramp up production with tough notices. It is keenly conscious that if it concedes “force majeure” to the old lessees, its new lessees who have promised to part with their entire sale price and more as premium will ask to be extended the same consideration. JSW Steel, potentially Odisha’s biggest iron ore miner post 31 March 2020, has filed a caveat to be heard along
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