OMC writes to environment ministry seeking guidance on Niyamgiri bauxite deposit

The Odisha government hasn't quite relinquished its right to mine the controversial Niyamgiri bauxite deposit, originally identified to supply ore to Vedanta Resources' nearby alumina refinery. State-owned Orissa Mining Corporation (OMC), which was granted mining rights for 30 years in 2004, has written to the Union Ministry of Environment, Forest and Climate Change (MoEF), seeking "guidance on how to proceed" with the matter.

Two years ago, a dozen villages in southern Odisha invoked their right to worship the Niyamgiri hilltop, warding off government plans to open a bauxite mine in their neighbourhood. The historic and exceptional referendum ordered by the Supreme Court was cited in January of 2014 by the then union government to refuse final forest clearance to the proposed mine, critical to Vedanta's refinery at Lanjigarh - about 4 km from the 72-million-tonne deposit.

Environmentalists world over celebrated the victory of the Dongariah and Jarnia Kondhs primitive tribal groups from one of least developed corners of the country, in the "David versus Goliath" battle against London-listed Vedanta.

Vedanta recently said it cannot continue running the loss-making plant for much longer in the face of low global aluminium prices and lack of cheap bauxite.

While OMC's letter to the MoEF remains unanswered, the state plans to write again to the Centre, placing the ball in its court. "We would like the Government of India to clarify on whether the stage I clearance holds, we start all over again or the verdict (based on the referendum) is binding forever," said Odisha Chief Secretary Gokul Chandra Pati.

Jairam Ramesh, who was the environment minister when early clearances granted to the project were withdrawn, said the decision based on the referendum was final. An eminent environment lawyer said, if OMC, despite the SC order, seeks so desperately to revive the Niyamgiri project, it must seek again not just forest clearance but also environmental clearance from scratch.

Niyamgiri is one among the many bauxite deposits scattered over these parts of the Eastern Ghats that account for 60 per cent of the country's known reserves. For investors such as Vedanta and Aditya Birla Group who ventured to set up plants here, the added proximity to coal - aluminium being a power intensive business - promised to change the world order of aluminium producers.

Now, with aluminium makers battling falling global prices, Vedanta suffers also from the disadvantage where bauxite is concerned.