The uncertainty over Posco setting up a Rs51,000 crore steel plant in Orissa may be over in the coming months.
The uncertainty over Posco setting up a Rs51,000 crore steel plant in Orissa may be over in the coming months.
The Supreme Court has issued notices on the cross-appeals raising objections to certain issues by the Orissa High Court in July last. A bench of Justices RV Raveendran and AK Patnaik on Monday directed to maintain status quo till the next hearing.
The judges issued notices to the Union government, the Orissa government, South Korean steelmaker Posco and Geomin Minerals & Marketing Ltd, a mines & minerals company.
The state government and Geomin had both challenged an Orissa High Court order quashing the state government’s notification for allowing iron ore mining in over 2,500 hectares in the Khandadhar Hills in Sundergarh district to Posco.
On July 14 this year, the HC, on a petition by Geomin Minerals, had set aside the state’s order to allot the licence.
The Orissa government, in opposing the HC order, said the court could not have quashed its grant of licence to Posco as the same was issued under Section 11(5) of the Mines and Minerals (Development and Regulation) Act, 1957.
It said that Section 11(5) gives power to the state government to “grant a reconnaissance permit, prospecting license or mining lease, as the case may be, to an applicant whose application was received later in preference to an application whose application was received earlier”.
The issue goes back to January 2009, when the state government recommended Posco to the central government for granting prospective license for Khandadhar iron ore reserves.
Geomin and 16 other firms which had also applied for mining leases intervened. However, Geomin’s SC petition says the HC order didn’t take into account its pleadings and “traversed beyond the pleadings and prayer made by it.”
Posco and the Orissa government signed a Memorandum of Understanding (MoU) in June 2005 for setting up an integrated steel plant with a total capacity of 12 million tonnes (mt) per annum in the Jagatsinghpur district of Orissa, located along the coast of Orissa.
Posco’s Indian arm is to set up the plant to produce a total of 12 mt of steel per annum.
Initially, the plant would produce 4 mt of steel per year, and capacity would be increased in phases to 8 mt and thereafter, 12 mt.
The MoU says Posco would also develop and operate mining facilities in the areas allocated by the government of Orissa or the Centre.
It would also develop and operate road, rail and port infrastructure including a dedicated railway line.
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