NEW DELHI: Central government gave state-run Steel Authority of India Ltd (SAIL) environmental approval for its Chiria iron ore mines in Jharkhand on Thursday.
SAIL said Chiria will be operational in three years and will be the key to its future iron ore supply.
SAIL plans to spend Rs50 billion ($1.1 billion) in developing the northern Indian mine. It will produce 7 million tonnes per year of iron ore initially, the company said in a statement.
“After depletion of SAIL’s existing mines in the eastern region, the Chiria mines will be the sole source of iron ore for SAIL’s four integrated steel plants located at Bokaro, Burnpur, Durgapur and Rourkela,” the statement said.
“This is a landmark in our persistent efforts to obtain security of raw material supplies,” SAIL Chairman C.S. Verma said in the statememt.
“Chiria is essential for the future of SAIL,” an Environment Ministry statement said. “Over the next 50 years, 40% of the iron ore requirement of SAIL will be met from the Chiria mine.”
Environment Ministry said SAIL’s follow-on public offer which is waiting to go ahead was one of the factors weighing on the decision, delivered early.
Shares of SAIL closed on the Bombay Stock Exchange at 161.05 rupees, up 5.19 percent from a day ago, when the key 30-share index closed down nearly 1%.