India: Showcaused iron ore lessees get a hearing in Odisha

Odisha's Mines Directorate is hearing lessees it show caused for falling short of the yearly production targets.

On Tuesday, Serajuddin which has been slapped with a claim of Rs 6028 crore for meeting only 16 per cent of its MDPA target was heard, as was Narbheram Steel and Power which couldn't meet the MDPA target of Roida II iron ore mine. The two companies have moved the High Court.

On Wednesday, Joint Director of Mines, Joda division will be hearing AM/NS which has missed its targets at Thakurani mine by a thin margin and Jagat Janani, a company promoted by local politician turned miner, Sanatan Mahakud which had bagged the small Jururi Iron Ore Block. JSW Steel's turn comes up on 2 September 2021. The company which is in process of surrendering the Ganua iron ore mine has fallen short of its MDPA target at its Jajang mine, which it could also surrender. Similar exercise would be under way for mines in Koira and Sukinda districts.

The uncertain fate of these auctioned mines, many of whose owners are unlikely to pay the steep compensation running into hundreds and thousands of crores, has led to suppliers avoiding them. Market sources and data SteelMint has looked at suggest a wariness in doing business with these miners under the current circumstances. "There is a fear that we may not be able to eventually actually pick up material that we pay for," said a trader.