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Posco eyes open market iron ore |
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administrator |
DATE |
2008-01-24 09:13:22 |
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Posco eyes open market iron ore
Press Trust of India
NEW DELHI, Jan. 23:
Realising that securing captive mines for its proposed Rs 52,000 crore steel plant could be a lengthy exercise, the Korean steel giant Posco has said that it is ready to source iron ore from the open market for the first phase of the mega project.
“Posco is aware that in spite of the best of efforts, there may be a time mismatch between the two. In case of such an eventuality, Posco India would not like to wait for captive mines to be obtained and made operational and then start production of steel, at least in respect of the first module,” Posco has said in a petition to the Supreme Court.
Posco’s petition comes after the central empowered committee (CEC), appointed by the apex court to delve into its forest diversion proposal, recommended that the steel giant’s entire plan comprising a steel plant with captive mines and port should be reviewed as one single project for its ecological significance and rehabilitation plans.
Saying that it was aware that millions of tonnes of iron ore are being sold in the open market both by indigenous sales and exports, Posco said in the eventuality of a time mismatch between captive mines being available and rendered operational and completion of the first phase, the company is open to sourcing ore from the market.
However, it reminded that the decision to invest in India, was made owing to assurances on captive mines being made available for its steel project.
It pointed out that there were other applicants for the areas applied by it and hearings on the merits of the various applications were being conducted by the Orissa government.
Pointing out that the distance between the mining belt where Posco India may get mining leases was roughly about 250-300 km away from the steel project site, the company said it should not be construed that the mining lease area and the plant site as well as the port are in the same area or are in close proximity to each other.
The Korean steel giant also pointed out that unless the forest diversion proposal is cleared, it would not be able to fulfil certain conditions enshrined in the MoU with the state government.
According to the MoU, Posco must award 50 per cent orders for civil and structural contracts in terms of value and place 20 per cent of firm orders for machinery in terms of value. The company said if the CEC’s recommendations were accepted, then it would delay construction of the steel plant and the port besides delaying generation of revenue for both the state and the Central governments.
Moreover, it could delay setting up of upstream and downstream industries which are likely to come up, involving considerable loss of investment and generation of further revenue and employment.
“Such delay may also deter other foreign investors who are interested in investing in India,” Posco said in its petition.
Resource from www.thestatesman.net |
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