India: Fresh ban on despatches from Sarda Mines

Despatches of Sarda Mines (SMPL) have been stopped by the Odisha government even as the iron ore miner pursues its clearances with the Ministry of Environment and Forest, Climate Change (MoEFCC).

On Thursday, Mines Director, wrote to his colleague at Joda to ensure road despatch from SMPL's Thakurani- B mine was suspended immediately on grounds that the Environment Clearance (EC) only allowed transportation by conveyor belt.

Background

Sarda Mines, a long-term supplier of ore to Jindal Steel and Power Ltd, was among those that paid the steepest compensation, of Rs 933 crore, for excess mining under Supreme Court orders. Its unusual clearances - specifying a cap in lumps rather than ore and being conditional to forest clearance - took almost six years to resolve and SMPL was granted permission to resume operations by the SC only in January of this year.

It must have thus come as a rude shock when the MoEFCC decided last month that SMPL had no valid clearance. It proceeded by asking the state government to immediately suspend operations. As SteelMint had reported, SMPL has since been operating under a stay against any action by the state, granted to it by the High Court of Orissa.

New suspension

Director of mine's fresh letter ordering a suspension again seems to suggest the department found irregularities during field visits between 06 - 09 October 2020. The lessee has been show-caused in this regard.

It seeks distinct demarcation of royalty paid stock from other minerals in the leasehold area, a compliance report on the present position of the stock and a clarification on any "additional quantity of iron ore against the stock as was allowed for despatch by the Supreme Court of India."

In a separate letter to the Principal Secretary, Department of Steel and Mines, the directorate wanted to know whether despatches on which royalty had been paid in 2014 (before mining came to a halt) is to be charged royalty/DMF/NMET at the present IBM rates.

TOR from MoEFCC

According to sources on Friday SMPL was granted terms of reference for expansion from its last recognised EC of 4 mtpa of lumps to 15 mtpa of run of mine (rom). The miner, whose current lease is valid till August 2021, will have to arrange for a gram sabha for a final clearance.

The Mines Director on Thursday also ordered for caution notices against its own department's officers. Unhappy with the fresh round of allegations of mining irregularities, Odisha government seems to have decided to be tough with lessees and equally unforgiving of its own officials for any lapses.