Steel Ministry seeks decision on iron ore mines for Sail

New Delhi: The Steel Ministry has sought support from Forests and Environment Ministry for getting an early decision from the Supreme Court on the Rowghat iron ore mines, which is critical to Sail's Rs 54,000 crore expansion plan.

Sail's plan to reach 26 million tonnes of steel production by 2011 may hit a roadblock if its cash cow, Bhilai Steel Plant (BSP) is not able to augment capacity from 4.8 to 7.5 million tonnes due to depleting source of iron ore, Steel Minister Ram Vilas Paswan said in a letter to Minister of State for Forests and Environment S Regupathy.

'The expansion plans of Sail would become viable only if it continues to have access to its own reserve of iron ore,' Paswan said.

At present, BSP sources iron ore from Dalli and Rajhara group of mines which are on the verge of depletion. The total reserves left in these mines in Chhattisgarh are around 50 million tons and would not last for more than five years, a company official said.

Sail had applied for fresh mining leases of the Rowghat deposit in the state, which was favoured by Chhattisgarh government, but the proposal cannot proceed unless necessary clearances are obtained from the Central Empowered Committee (CEC) of the Supreme Court.

The state government had recommended that at least one of the pockets of the Rowghat mines with a reserve of about 511 million tonnes be given to BSP.

The Forest Advisory Committee (FAC) of the Ministry of Forests and Environment had also cleared diversion of 883.22 hectares of forest land for the Rowghat iron ore mining project in favour of Sail in June 2007.