Sesa Sterlite starts mining in Karnataka

Sesa Sterlite, part of Vedanta Group, has resumed iron ore mining in Karnataka and expects to produce 700,000 tonnes this month.

Tom Albanese, CEO, Vedanta Resources, told BusinessLine that the State Government has renewed the mining lease, and the company started mining in Karnataka from last week after receiving statutory clearances. 

"The annual production capacity at the mines has been capped at 2.3 million tonnes. We would be able to reach the annual target easily, if the market conditions are favourable," he said.

The company's iron ore mine is located in the southern part of Karnataka in Chitradurga district which used to produce 6 million tonnes a year before the mining ban was imposed.

Mining activities in the country came to a standstill after the Supreme Court imposed a ban due to illegal mining on the basis of the Shah Commission report. 

In April 2013, the apex court lifted the ban on iron ore mines in Bellary, Chitradurga and Tumkur districts of Karnataka.

Of 115 mines (categories A and B) that are eligible to start operations after the Supreme Court’s April verdict, only 24 mines have commenced operations.

The company has been facing challenges in restarting mining in Goa.

The Supreme Court has ordered that mines should not dump the waste outside the mining area.

However, Albanese said the mines in Goa are small and miners have been allotted a specified area outside the mines for dumping.

"The mining industry in Goa has expressed its concern to the State Government and it has been assured to sort the issue out," he said.

Steel companies have been facing huge shortage of iron ore and some of the companies have to cut their production for want of iron ore.

Though iron ore prices internationally are on a downtrend due to weak demand, it has been raising steadily in India.

A few steel companies such as JSW Steel and Tata Steel had resorted to imports to beat the short supply and prices. 

COMMENT NOW