The State Government is exploring the possibility of linking an alternative bauxite mine to the Vedanta Aluminium limited’s (VAl) one-million-tonne alumina refinery at lanjigarh as the chances of sourcing bauxite from the Niyamgiri Hills have become remote following the adverse verdicts at all the Palli Sabhas.
Sources in the Department of Steel & Mines said the Government is proposing to link the bauxites from the Sijimali-Kutrumali mines in Rayagada and Kalahandi district with the VAl. Since the two mines are entangled in litigation, the Government, which had sought legal opinion on their legal status before linking the reserves with the Vedanta’s plant, has reportedly received the opinion.
The Government, in fact, had allotted the two mines in favour of l&T in 1992 with conditions of value addition to the minerals by setting up a refinery in the State. Though the l&T tried to rope in Alcoa of the US, Al Pechiney of France and Dubal of Dubai at different points of time to set up a plant in joint venture, the move could not materialise. So, the Government cancelled the allotment to the l&T.
The l&T, however, got an order from the Appellate Authority in the Union Ministry of Mines for reconsideration of the decision. The State Government is contemplating to cancel the mines allotted to the l&T and link them with the Vedanta. While the Sijumali, located in Rayagada district, promises a bauxite reserve of 245 million tonnes, the Kutrumali in Kalahandi is having a possible reserve of 40 MT.
The State Government in its MoU with the VAl has promised to supply 150 MT of bauxite. The raw material requirement of the VAl would be solved if the Sijumali-Kutrumali mines could be linked to its plant, sources said. Meanwhile, the State Government is also proposing to lease out laterite deposits to the Vedanta as part of its assurance for raw material linkage. Rayagada Collector Sashi Bhusan Padhi has recommended to the Government for lease of 20 hectares of land with rich laterite deposits in Kasipur block of the district in favour of the VAl.
Besides, the Rayagada district administration is also examining three more applications of the VAl forwarded by the Korpaut Deputy Director of Mines (DDM) for lease of laterite deposits. “As getting bauxite from Odisha mines would take some more time even if the State Government dispensed favourably, we are looking for alternative sources of bauxite to feed our plant,” VAl President and COO) Mukesh Kumar said. “We have some experience of extracting bauxite from laterite soil in Andhra Pradesh,” he said, adding that laterite soil contains 20 per cent to 25 per cent of bauxite.
It may be noted that the Odisha Mining Corporation (OMC), which is the leaseholder of the Niyamgiri mines, had firmed up a joint venture with the Sterlite Industries (India) ltd.(SIl), a group company of london-based Vedanta Resources, for making the mines operational with condition that the raised minerals would be supplied to the VAl’s refinery located at lanjigarh in Kalahandi. The mine was accorded Stage-I forest clearance. However, acting on a report of the Saxena Committee, the Union Ministry of Environment and Forests (MoEF) denied the Stage II forest clearance and also suspended the Stage-1 clearance accorded earlier.
Aggrieved with the decision, the OMC went to the Supreme Court and it was on July 18 that the Supreme Court disposed of the case directing that the community and religious rights of the villagers living in the Niyamgiri Hills be ascertained through Palli Sabhas. The villagers, mostly Dongria, Kutia and Jharnia tribals at 12 hill slope villages, where the Palli Sabhas were held recently, opposed the mining project on the ground that it would hurt their religious sentiments and have an adverse impact on their livelihoods.
Following the MoEF’s decision, the VAl had shut down its plant for about seven months from December 5 last due to lack of bauxite. It, however, reopened the plant in July this year with bauxite arranged from Gujarat and Chhattisgarh. The plant is currently running at 60 per cent of its capacity. The high cost of the raw material and the low capacity utilisation is stated to be adversely affecting the VAl’s finances. The laterite option, if it materialises, would bring some relief to the plant, but it is the linkage of a bauxite mine which would only make the plant viable, sources said.