New Delhi: In a setback to state-owned SAIL, the Odisha government has asked the steel giant to shut Bolani mine, which produces over 4.2 million tonne iron ore a year, as the forest clearance has expired.
Steel Authority of India (SAIL), however, tried to downplay the development saying the "matter" was a routine one and the mine would be operational in a day or two without impacting company's production.
Deepak Kumar Mohanty, Director of Mines, Odisha government, said that the closure was necessitated as the forest clearance for continuing with the mining activity at the Bolani mine expired on February 11.
"The forest clearance of the mine has expired on February 11 and hence the mining operation has been stopped," Mohanty said.
SAIL had commissioned its Bolani iron ore mine in 1960 and the mine produces around 4.2 million tonnes of the key steel-making raw material a year. The ore produced from the mine is largely consumed by the Maharatna company's Durgapur Steel Plant in West Bengal.
"Durgapur Steel Plant draws its coal from the adjacent Jharia-Ranigunj coal belt. A good amount of prime coking coal, having fairly low ash content, is also imported. Bulk of iron ore lumps and fines come from the mines at Bolani in Orissa," according to SAIL's website.
"The clearance is expected anytime soon and there will be no impact on the production of steel in our plant," SAIL's spokesperson R K Singhal said.
SAIL is considered among the most privileged steel maker in the country because of its captive iron ore sources, unlike others who are forced to buy the raw material from the open market to run their operations.
The company, which has currently 14 million tonnes a year steel making capacity, is in the final stages of adding additional 9 mtpa capacity a year with an investment of Rs 72,134 crore.
SAIL's requirement of coking coal is around 14 million tonnes now, of which 11 million tonnes are imported. After the planned expansion goes on stream, SAIL's plants would require around 21 million tonnes of coking coal annually.
First Published: Tuesday, February 14, 2012, 21:35