India: Easing of stacking norms likely to boost iron ore dispatches from Odisha

The Odisha government amended the Odisha Minerals (Prevention of Theft, Smuggling and Illegal Mining and Regulation of Possession, Storage, Trading and Transportation) or OMPTS Rules last month addressing how ore is to be stacked, a requirement if waived earns the state greater revenues.

The 16 April 2021 notification suggested that the state will allow iron ore miners a five-fold increase in stacks that are made for a sampling of ore before its evacuation. This should ideally facilitate the smoother evacuation of ore however, the government has currently capped the height of the stacks to 3 meters.

New iron ore mines bagged through auction route had preferred not to seek an exemption from stacking which the state would approve if the miner paid royalty due on the highest grade of ore. The state government, throughout last year, had tightened its scrutiny of the stacks (of a mere 4000-5,000 tonnes), accusing many of the new lessees of violating OMPTS rules, while the lessees had complained that this was pace and time-consuming exercise that was hindering production. A compromise of sorts was reached when the state agreed to relook the pre-auction era rules.

The modified rules introduce all kinds of high-tech equipment to the sampling exercise - drones, webcasting, augmented reality and Radio-Frequency Identification (RFID) that are being tried out as a pilot project. Rectangular or trapezoid stacks of 20,000 tonnes are to be readied. The lessees must then request online for sampling via the online i3MS porta, and a random JMO will be assigned the task. The stack itself, from four corners and above will be recorded by augmented reality cameras, and the recording preserved for 45 days. As the lessee traverse to each sampling point generated randomly by an app, the blue-coloured cyber-physical anchors will turn yellow.

The inspection process will be activated only with the JMO's presence within geo-fence points applied by the lessee. The samples then packed into three nonwoven fabric bags. These primary(red), secondary(blue) and 'umpire' (green) bags of 3.3kg - with individual QR codes bags will then be analysed at Government chemical/analytical laboratories or NABL certified ones. Transportation by conveyor system or slurry pipeline shall be permitted on the representation of the lessee and as would be decided by the Government on a case-to-case basis.

Few of the Odisha's auctioned mining lesees like Serajuddin (which operates a mine with a 15.5 million tonnes per annum EC limit) had earlier requested an exemption from existing iron ore stacking and sampling rules. The miner had resumed the iron ore sales offer after a gap of two months in Feb'21 due to similar concerns.

With recent notification on easing of stacking norms, iron ore dispatches from the state are likely to improve. On 8 May'21, Serajuddin had raised lumps 5-18 mm (Fe 63%) offers by INR 100 to INR 11,000/t ex-mines (including Royalty, DMF & NMET), SteelMint learned from sources. Yesterday, it also resumed iron ore fines (Fe 63%) offer after a gap of one month which currently stands at INR 8,000/t ex-mines (including Royalty, DMF & NMET).