Odisha govt looks for new bauxite mines for Vedanta

After the shutdown of Vedanta Aluminium’s one million tonne alumina refinery at Lanjigarh on December 5, the Odisha government seems to have woken up, albeit belatedly, to the raw material crisis that has stalked the company for last five years.

In a bid to help revive operations of the Lanjigarh refinery, the steel & mines department has started the process of identifying prospected bauxite deposits where mining operations can commence with the statutory clearances.

The department has urged the mines directorate to furnish the status of Niyamgiri, Karlapat and other prospected bauxite deposits which are available for taking up mining operations directly by the state government or through Odisha Mining Corporation (OMC).

The Director of Mines said, finding such a deposit will take some time. “It will take at least three months to find out the deposits, boundary area demarcation and other issues of possible bauxite mines including information from the state geology department. Then only we can suggest a name,” said Deepak Mohanty, director of mines with Odisha government.

Searching for an alternative bauxite source became necessary as VAL blamed the Odisha government for not keeping its promises made in the MoU to provide bauxite linkage to its alumina refinery.

Though VAL had signed a joint venture agreement with OMC for sourcing of bauxite from the latter’s Niyamgiri deposit, the mining operation could not be taken up in the area due to persistent protests by tribal community and green activists, finally leading to the cancellation of forest clearance to the project by Union Ministry of Environment and Forest (MoEF) in August 2010. After the Niyamgiri fiasco, VAL had sought bauxite supplies from seven alternative mines more than two years back. Out of seven alternative bauxite mines sought by Vedanta, five were in Rayagada district with the remaining two in Kalahandi district. The five mines being eyed by VAL in Rayagada district include Sarambai, Malipadar & Kutamal spread over 177.694 hectares; Siadimal spread over 4.95 hectares; Badamaribhata on 4.89 hectares; Kutamal and Kashipur spread over 4.966 hectares and Kutamal on 4.98 hectares.

In Kalahandi district, the company had applied for two mines- Punjam, Raipadar and Ranapur (580.43 hectares) and Kariapat, Salpara and Jilgaon (3,172.74 hectares).

The company was even keen on Gandhamardhan bauxite deposits to feed its alumina refinery at Lanjigarh.

The Gandhamardhan bauxite mines are spread over Bargarh and Bolangir districts over an area of 2,365 hectares with a reserve of 207 million tonnes. OMC, which is a bonafide applicant for the Gandhamardhan mines, has been granted prospective license but the mining license is yet to be granted due to pending forest clearance.

However, the state government's inaction in processing bauxite lease applications had forced the VAL refinery to plunge into a crisis. Though Vedanta chief Anil Agrawal had met the Chief Minister Naveen Patnaik in early November and urged him to ensure bauxite supply to the Lanjigarh refinery, it did not yield any result.

The Supreme Court has fixed January 11 as next date for hearing the case. It has asked both the state government and central government to come up with their replies on compliance with forest act and find out the effect of blocking mining due to forest laws on the state of economy, respectively.

Due to the Niyamgiri fiasco, VAL totally depended on externally sourced bauxite to operate its refinery. After running the refinery at a depleted capacity ranging from 40-60 per cent, VAL served a three-month closure notice to the state government on September 6, before finally going for shutdown on December 5.