With the Goa government putting a blanket ban on mining, Vedanta group firm Sesa Goa on Tuesday said it has stopped extraction of iron ore from all its mines in the state, leading to 6 percent fall in its stock price.
New Delhi: With the Goa government putting a blanket ban on mining, Vedanta group firm Sesa Goa on Tuesday said it has stopped extraction of iron ore from all its mines in the state, leading to 6 percent fall in its stock price.
Following the suspension of works, all the mining operations of Sesa Goa -- the largest private sector iron ore producer of the country -- have come to a standstill.
Sesa Goa's operations in Karnataka have been closed for more than a year due to a Supreme Court imposed mining ban in the southern state. In December, 2010, it had discontinued operations in Odisha.
After the announcement, the company's scrip has tumbled over 6 percent from its previous close on the BSE. At 1415 hrs, it was trading at Rs 159.95, down 5.72 percent.
"The Director of Mines, Government of Goa, on September 10, 2012, issued orders for temporary suspension of mining operations of all the mining leases in Goa, with effect from September 11, 2012, until further orders. Consequently, Sesa Goa has stopped ore extraction from all its mines in Goa," the company said in a statement.
It added, "Sesa will submit all relevant documents to the government authorities for scrutiny at the earliest in order to ensure early restart of operations."
The company, however, did not comment on how much impact the suspension of mining in Goa will have on the revenues as all its iron ore extraction activities have come to a close.
Goa has been the mainstay of Sesa Goa since its inception and the company currently has a mining capacity of 14.5 million tonnes per annum (MTPA) in the state. It has been hoping to increase it little bit to 15 MTPA in FY13.
Yesterday, the Goa government had issued a notification asking all the 90 mines to suspend operations in the state in the wake of Justice M B Shah Commission report which had pegged state's iron ore mining scam at nearly Rs 35,000 crore.
The Shah Commission had also claimed that all the 90 mines operating in the state were illegal as they did not have the permission from National Board for Wildlife. The NBW permission is required as a part of Environment Clearance.
However, the ban is limited to mining operations only and pending verification of documents, the state government has allowed transportation and trade of iron ore already mined and existing either in lease hold area, in transit or stored at jetties.
The lease holders or traders have also been asked to report the exact location of their ore within 7 days.
Goa is the second largest iron-ore producer in India with about 50 MT production last year.