With Mittal Steel Chairman L N Mittal slated to arrive in New Delhi on Friday for his meeting with Union ministers, the state-owned Steel Authority of India Ltd on Thursday announced a Rs 1,800-crore (Rs 18 billion) plan to mine up to 7 million tonnes of iron ore from the Chiria mines in Jharkhand.
The Chiria mines, 180 km from Jamshedpur, the nearest urban centre, have been in the spotlight for their proven ore deposits of 1.8 billion tonnes, with its iron content a robust 63 per cent. That makes them Asia's largest iron ore belt, and the world's second largest deposits of high-grade iron ore after those in the Urals.
Mittal, who last year signed a memorandum of understanding with the Jharkhand government to set up a 12-million-tonne steel plant in the state, is seeking 600 million tonnes of ore, mostly from Chiria, over 30 years.
At present under litigation, the Chiria mines are among the few known deposits of iron ore in Jharkhand, making them critical for Mittal's project.
Tata Steel and Essar Steel are also eyeing these mines.
Fortunately for the suitors, the mines are largely unexploited, and contributed a mere 0.5 million tonnes to India's total output of 150 million tonnes last year.
Executives in SAIL's raw material division said the public sector undertaking had already completed an environment impact assessment study for the mines, and applied to the Jharkhand State Pollution Control Board for a no-objection certificate. The company had asked Mecon to draw up a detailed project report, which was expected to be ready this month.
However, the Jharkhand government is said to be upset over the fact that the mines were not developed by SAIL all these years.
Sources said SAIL was looking to tap Chiria to feed its Bokaro and Burnpur plants, which were fed by the depleting reserves of Kiriburu and Keghatuburu at present.
SAIL, which planned to increase its capacity to 22.5 million tonnes a year by 2011-12, compared with the present 13, would need about 37 million tonnes of iron ore at that time. Its mines in Kirirburu, Barsua, Meghtaburu, and Bolani would together supply only 30 million tonnes.
