Govt clears SAIL’s proposal to divert land in Gua mines

New Delhi: An environment ministry arm has approved a proposal by state-owned Steel Authority of India Ltd (SAIL) to divert a part of forest land around the Gua mines in Jharkhand to mine iron ore. The forest advisory committee (FAC), which met on Thursday and Friday, cleared the proposal, a government official said on condition of anonymity.

SAIL had proposed that 635.986 hectares of forest land surrounding the Duarguiburu iron ore be de-linked and forest clearance granted for it, out of the total lease area of 1443.756 hectares that has been approved for mining. It also requested that the clearance be de-linked from the so-called “integrated wildlife management plan” (IWMP) for the whole area, to be submitted by the state government.

Environment minister M. Veerappa Moily still needs to sign off on the proposal.

FAC had told SAIL in 2009 to adhere to five conditions, including preparation of a comprehensive wildlife conservation plan.

Mining in Gua and its expansion are integral to boosting SAIL’s hot metal capacity—the benchmark for steel output—to 21 million tonnes per annum (mtpa) by March 2014. With the increase in steel production capacity, SAIL’s iron ore needs will almost double to 39mtpa.

SAIL meets all its iron ore requirements from captive mines. The Gua mines alone will provide 25% of SAIL’s iron ore needs. It is investing over ₹ 10,000 crore to expand the capacities of all its captive mines.

The mining stopped in June 2011 as approvals expired and resumed in April 2013 after a temporary work permit granted by the environment ministry.

The FAC’s clearance and its follow-up will help SAIL in its capacity expansion, said Arvind Mahajan, partner and head of the energy and infrastructure division at consulting firm KPMG.

“Having a captive source definitely gives you advantage in reliability and cost,” Mahajan said. “This will give them the impetus to push ahead on some of the other fronts.”

Meanwhile, FAC has asked for additional information from ArcelorMittal India Ltd for mining of iron ore and manganese in Saranda forest division in West Singhbhum district of Jharkhand. The company has been struggling to construct the 12 million tonne per year steel plant since 2005, when the project was first announced, due to multiple issues including problems in acquiring land and regulatory delays.

SAIL declined to comment; ArcelorMittal did not respond to an email.

PTI contributed to this story.