India: OMC to Conduct Bauxite E-auctions in April

Odisha Mining Corporation (OMC), the state owned mining entity is all set to conduct national e-auctions of bauxite, its first ever of the mineral ore in April.

Though OMC has not spelt the name of the mine, bauxite sourced from the Kodingamali mines would be offered at auctions. The quantity of bauxite to be auctioned is not known yet and will be determined on the interest from the potential bidders, said an OMC source.

OMC today has invited notice from applicants for registration to participate at the national auctions for bauxite. Preference would be given to end use industries and any surplus left after fulfilling the requirement of such industries would be offered to traders. The deadline for registration is March 23.

OMC has decided to sell 30 per cent of its saleable bauxite stock through national e-auction. The residual 70 per cent would be liquidated through long-term linkages.

The auctions are to be conducted by central government owned PSU MSTC Ltd.

Meanwhile, OMC has floated an Expression of Interest (EoI) for long-term linkage (LTL)N with eligible state based end user industries for buying bauxite.

The weighted average price derived from the national e-auction would be the LTL price. The floor price for the national e-auction would be kept at cost of production plus profit margin of 50 per cent. The LTL provision would primarily benefit Vedanta as other aluminium players- Hindalco Industries and navratna PSU National Aluminium Company Ltd (Nalco) are already fed by captive supplies.

Earlier, the Odisha government had constituted a committee under the chairmanship of the Chief Secretary to make appropriate recommendations on the nature and detailed modalities for supply of bauxite ore by the OMC to the Lanjigarh alumina refinery as and when any bauxite mining leases are operated by OMC.

At the national e-auctions, OMC would directly deal with the end-user industries. Participation by the traders would be considered only if there is lack of adequate response from the end-user industries.

Though Odisha has bauxite reserves of 1968.86 million tonnes, annual production is only 9.2 million tonnes.