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SAIL stakes claim to all of Chiria

New Delhi, June 17: The Steel Authority of India Limited has said it will not part with its iron ore leases for the Chiria mines in Jharkhand. It is, however, open to other steel makers getting access to the adjacent reserves at Ankua.

SAIL chairman S.K. Roongta told The Telegraph that the PSU has firmed up its investment plans till 2020 that envisage use of the entire “ore production from Chiria”.

Sparks are now likely to fly at the meeting on Chiria to be held at the Prime Minister’s Office next month.

It needs to be seen whether an out-of-court settlement between SAIL and the Jharkhand government emerges from the meeting.

Jharkhand wants to give some of SAIL’s mining leases for Chiria to other steel companies. Roongta said this was not possible because SAIL would utilise the ore for its expansion plans in the state and IISCO Steel Plant’s Burnpur facility.

He said he had no objection to Jharkhand allotting the ore at Ankua to others.

Private steel companies such as ArcelorMittal, the Jindals and Essar Steel have been eyeing the Chiria reserves. The leases were with IISCO, but got transferred to SAIL after the PSU acquired the ailing company.

Both Chiria and Ankua fall within the Saranda forests; SAIL holds the mining rights for Ajitaburu, McLellan, Dhobil, Sukri and Tatiburu at Chiria. It also holds the rights for 67 acres at Ankua. In all it holds the rights to 2,350 hectares of leased mining area. Though the reserves at Ankua have not been mapped out fully, analysts peg them at 600 million tonnes on the basis of preliminary surveys.

Steel makers, too, are keen on this area because it will be easier to get the leases rather than wait for the outcome of the discussions over Chiria.

Jharkhand and SAIL have been engaged in a prolonged tussle over Chiria, with the state government saying it will only renew the leases to the extent of the PSU’s requirements in the state and for IISCO. The reserves are estimated to be 1.7-2 billion tonnes.

SAIL said it would need all the ore — reputed to be the best in Asia — for its projects in the state and IISCO.

The PSU will take its steel making capacity in Jharkhand to 29mt by 2020 and ramp up the capacity at Burnpur to 3.2mt.

In Jharkhand, the plan is to increase the capacity of its steel plant at Bokaro to 17mt and set up a new 12mt plant at Manoharpur.

For SAIL, retaining Chiria is vital to its growth plans. The raw materials division of the company has set a target of producing 19mt of ore by the end of this fiscal and wants to increase this to 26mt by 2012.

The major chunk of this supply will come from Chiria, for which SAIL has prepared a blueprint to upgrade the mining facilities.

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