JSW Steel Among 10 Companies in Race for 4 Goa Iron Mines

SEATTLE (Scrap Monster): More than four years after mining was banned in Goa, about 10 companies including Sajjan Jindal-led JSW Steel have placed 28 bids for the four mines put on auction.

The last day for placing the bid for the three mines in Bicholim and one in Sanguem was on Tuesday. These mines have cumulative estimated reserve of about 135 million tonnes of low-grade iron ore resource.

These mines were previously operated by mining firms such as M/s Narvekar, M/s Rajaram Bandekar, M/s Chowgule & Co Pvt Ltd and Sesa Mining Corporation. Almost all the iron ore extracted from Goa mines were exported to China.

Intensive bidding expected

The Indian Bureau of Mines will set the base price for the e-auction being conducted by MSTC and bidders have to quote the premium they will pay over the base price, said a senior executive of steel company who has placed the bid in the auction.

 Given the response, the auction will definitely see intense bidding given the fact all these mines have beneficiation plant which will improve the quality of iron ore for blending with high quality iron ore to make pellets, he added.

JSW Steel, which has shown interest in all the four Goa mines, can blend it with high quality iron ore sourced from its captive mines in Odisha at its 10 million tonne steel plant at Dolvi with an eight million tonne pellet unit and a jetty that can handle 15 mtpa of cargo.

JSW Steel has also set target to expand its capacity to 38 mtpa by 2024 from the present 23 mtpa (including the recently acquired Monnet Ispat and Bhushan Power and Steel).

Letter of Intent

As per the tender document, the names of successful bidders would be declared between December 13 and 21. Following which, the first instalment of the bid price will have to be paid to the government within 15 days after which the Letter of Intent will be issued.

In March 2018, mining operations in Goa was suspended after the Supreme Court cancelled the 88 iron ore mining leases in the State that were renewed by the government in 2014-2015 just before the Mines and Minerals (Regulation and Development) Act mandated the auction of leases.

Goa used to export about 20-25 million tonnes of iron ore a year. In 2004, Goa’s mining sector became a free-for-all activity and exports jumped to a record 54 million tonnes.

Courtesy: www.thehindubusinessline.com