India’s top court cancels iron ore mining permits in Goa

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India’s Supreme Court has quashed all iron ore mining permits in Goa, one of the country’s top producing states for the steel making raw material, an environmental group that petitioned the government to halt the mining said on Wednesday.

Mining in the southwestern state of Goa, which produces low-quality iron ore, will stop after March 15 and the government will need to issue new licenses, Claude Alvares, who heads the environmental group Goa Foundation, told Reuters by telephone from outside the court in New Delhi.

“From the 16th of next month, mining companies in the state will be bereft of any leases,” said Alvares, who was in the court when the judgment was read out. “They are back to zero. Ownership is back to the government. They will have to auction the leases.”

Prashant Bhushan, the lawyer for the Goa Foundation, confirmed the ruling on his verified account on Twitter. “Kudos to Supreme Court for cancelling all 88 iron ore mining leases,” he wrote.

Billionaire Anil Agarwal’s Vedanta Resources is the biggest iron ore miner in the state.

Court action against illegal mining shut the industry in Goa for more than two years from 2012. Goa had exported about 50 million tonnes of iron ore a year before the ban was imposed. The Supreme Court later limited production in the state to 20 million tonnes a year.

The latest ban would affect not only Vedanta but also several small unlisted companies run by local business families. A Vedanta spokeswoman said “it would be inappropriate to comment without reading the judgment copy”.

Vedanta expected to produce around 5.5 million tonnes of iron ore from Goa this fiscal year ending March 31. India’s iron ore production totaled 192 million tonnes during the last fiscal year.

Most of Goa’s iron ore is exported to China as Indian steel companies do not have the technology to process it.

Chinese iron ore demand has slowed after steel production curbs enacted since the middle of November to curb industrial emissions as part of the country’s fight against smog. The curbs are in place until the middle of March.

Mining companies in Goa earlier lobbied to get the export duty on iron ore reduced given a large stockpile of already-mined ore in the state.

Source: REUTERS