New Delhi: A report submitted to the Supreme Court by the court-appointed Central Empowered Committee (CEC) on Friday said that more than 395.645 lakh metric tonnes (mt) of iron ore had been illegally mined in Goa in 2006-2011.

“As against the total production of 1,553.724 lakh mt of iron ore between 2006-07 and 2010-11, a total quantity of 1,949.369 lakh mt of iron ore of Goan origin has been exported," it said. “There is every reason to believe that the excess quantity of iron ore that has been exported is the illegally mined iron ore."

The panel, in its report, also said the illegal iron ore mined might be more than the previous figure of 395.645 lakh mt because, “in addition, part of the iron ore has been used for domestic consumption".

Although the report itself does not comment on the likely financial impact due to the export of illegally mined iron ore from Goa, data available suggests that the international spot price of the commodity quadrupled between 2006 and 2011. While between January 2006 and December 2007, the monthly average international spot price of iron ore was hovering in the $33.45-$36.63/tonne range, in January 2008, this shot up to a little under $61/tonne. The price has been steadily increasing since and now is in the $114-$120/tonne range.

Illegal exports from Goa could be higher than from other states like Karnataka that produce the commodity, said Chintan Mehta, an analyst with Mumbai-based Sunidhi Securities and Finance, who tracks iron ore.

“Having said that, the figure being quoted is less than a sixth of the total commodity produced by Goa. The financial impact on the state would, therefore, be limited," he said. Mehta, however, added that the total impact cannot be accurately computed.

The report has recommended scrapping 42 iron ore mining leases in Goa on environmental grounds.

“The MoEF (ministry of environment and forests) has granted the environmental clearances in respect of at least 19 mining leases located within the Netravali Wildlife Sanctuary and other sanctuaries," it said. “In these circumstances, the CEC is of the considered view that it is imperative that the environmental clearances granted by the MoEF in respect of these 19 mining leases located within the wildlife sanctuaries (and for other similarly placed leases) should be set aside and responsibility should be fixed against the erring officers and others."

The panel’s report said environment clearances had also been given to 23 mines located within 1km of national parks and sanctuaries, violating a stipulation by the Supreme Court that areas falling within a 1km radius be treated as safety zones.

Rama Velit, a local environmental activist in Goa, said over the phone that all the mines should be closed. “Mining is taking place even inside forests and, therefore, a lot of the wild animals come to farms because their water is being used by these mines," Velit said.

On the issue of lease holdings, the report said that “a very large number of mining leases are being operated by person(s) other than the lease holders", thereby violating the law.

The report mentions that even though this was happening under the nose of the state government, it took no action. “Complaints have been made to the state government with regard to a number of leases that the said leases were being operated by person(s) other than the lessees, but apparently no effective action has been taken," it said.

“On the contrary, the state government took the stand that the working of the mining leases by a person other than the lease holder is a prevailing mining practice in Goa and that these facts are in the knowledge of the government," it added.

The panel has recommended that “the details of all the mining leases in the state of Goa are verified with reference to the available records and wherever there are reasonable doubts that the mining lease is /was being operated by a person other than the lease holder, detailed enquiry should be held."

Haresh Melwani, chief executive officer (CEO) of HL Nathurmal, a small mining company in Goa, said, “The report has brought out the total failure in all the regualtory mechanisms like MoEF, ministry of mines through IBM (Indian Bureau of Mines) and the state government which are supposed to conceive, monitor and regulate this business in relevance to the fragile environment involved. Each had abandoned its responsibility and what has happened is a consequence of that."

Before the mining ban in September, Goa was India’s second biggest iron ore producer and top exporter. It produced more than 50 million tonnes annually and exported almost all of it.

Reuters and PTI contributed to this story.

The CEC also noted in its report submitted to the Supreme Court:

1. The extraction of mineral from the overburden dumps without any checks and balances and without environmental clearances are bound to cause serious environmental degradation.

2. Overburden/waste dumps should normally be located within the mining lease itself.

3. It is imperative that the state of Goa immediately puts in place an effective system of verification of the mineral produced from the mining leases, issue of transit passes, verification of transit passes during transit of mineral and reconciliation of the production with domestic consumption and exports. Till then the mining leases should not be allowed to resume mining operations.

4. The statutory authorities have completely failed to ensure that the mining operations are undertaken in a scientific and environmentally sustainable manner.

5. It may be appropriate and necessary that detailed survey and demarcation of all the mining leases is carried out to ascertain the details of the area under illegal mining pits, illegal overburden dumps and other details.

6. From 2005-2006 onwards the year-wise details of the production of the mineral for each of the mining leases is verified and wherever it is found to have exceeded beyond the quantities permitted under the environmental clearances, appropriate action should be taken for violating the provisions of the EIA Notification of 2006.

7. The existing infrastructure availability in Goa is grossly inadequate to handle the movement of such a large number of trucks.

8. There is therefore a real need to prescribe a cap on the maximum permissible annual production from all the mining leases.

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