India Update
Published by MAC on 2006-04-18
Indian Update
18th April 2006
India's headlong rush into new mining and minerals projects during 2005 - with scarcely any acknowledgment of the consequences to the environment and living things - came into sharp public focus, following last January's massacre of protestors at Kalinganagar. But, recently, criticisms at a political level have waned, although a number of community protests are proving resilient and Maoists ("Naxalites") have - sometimes very bloodily - entered the fray.
So, it seems that corporate India is (courtesy of the government) yet again "shining" with a multi-metallic, multinational, glint, while the country's energy "policy" is, to say the least, enigmatic. On the one hand there's a belated promise to invest in relatively benign coal bed methane capture. On the other hand, no brake is applied to open pit coal mining itself, and exploitation of uranium is being ramped up to dizzying heights. Government claims that mining yellowcake is virtually harmless defy all previous mining experiences around the globe - not least in India itself.
Posco to cut down ore swapping: New technology expected to bring down cost
Dillip Satapathy/Kolkata/Seoul
18th April 2006
South Korean steel major Posco has decided to significantly bring down the extent of iron ore swapping, the most controversial concession granted to it by the Orissa government, for its $12 billion, 12 million tonne steel project at Paradip.
"We will minimise the extent the iron ore swapping for the Orissa project following a decision to use Finex process instead of blast furnace route to make steel", said Ku Taek Lee, the chief executive officer of Posco.
He, however, asserted that the company may not totally drop this clause in the MoU signed with the state government last June.
Though he declined to mention by what per cent the declared rate of swapping will be brought down, sources said, it could be cut down by half to about 15 per cent to 20 per cent from the present level of 30 per cent when the company goes for final agreement with the state government for the project in near future.
In the MoU, the company had been granted the option of exporting 30 per cent of the iron ore from its allotted resources against import of high quality ore from Brazil.
This had created hue and cry in different circles as critics thought the concession may lead to "unnecessary" depletion of scarce iron ore resources of the country and put the company in an advantageous position vis-ˆÐ¦is domestic steel makers.
Posco, however, justified the clause saying Indian iron ore had high alumina content of over 2.6 per cent which was a hindrance in efficient operation of the blast furnace.
"The blending of Indian ore with imported ore from Brazil, which has only 0.6 alumina content, is necessary for efficient operation our Paradip plant", Lee had asserted during his visit to the state last year.
Meanwhile, the company has made a change in technology selection for its proposed Paradip plant following a detailed feasibility study.
Though Posco had initially thought of going for the blast furnace route, the feasibility study has suggested use of the Finex process, which is now under implementation at Posco's Pohang facility, for the Orissa project, Lee pointed out.
Sources said, the finex process can use ore with alumina content up to 3 per cent without much compromise on operational efficiency.
"The Indian ore is known to contain alumina of about 2.6 per cent. However, we will come to know the exact per cent of alumina in the ore in the mines to be allotted to us after detail examination of the raw material following grant of prospecting licence to us for mining operation", sources said.
In any case, the need of swapping for the Orissa project will come down significantly thanks to the technology switch over.
(The correspondent's trip to Seoul was sponsored by Posco).
India Inc lines up for a new slice of Orissa
Economic Times
10th April 2006
MUMBAI: The mineral-rich state of Orissa is looking beyond metals and the mining sector. After attracting over $20bn in investments in the metals and mining sector - a 12m tonne steel plant by Posco, aluminium smelters and alumina refineries by Hindalco and Vedanta - the state has become an investment destination for the cement, chemical and paper industries.
According to a senior official from the Orissa government, the state is also trying to attract investments in the food processing industry and infrastructure. This would include power and ports.
Emami, a front runner in the cosmetics business has finalised plans to set up a 85,000 tonne per annum paper mill in the state. The paper mill will bring in investments of close to Rs 300 crore. Pune-based Deepak Fertilisers is also planning to set up a three lakh tonne per annum ammonium nitrate plant at an estimated cost of Rs 400 crore.
Cement industry leaders ACC is planning a 1-2m tonne brownfield expansion in Orissa. While OCL, a cement company promoted by the Dalmia group, has also planned a cement capacity of close to 1m tonne. According to state government officials, the state is also looking at putting its huge reserves of thermal coal to use in the power sector. The officials claimed that that MoU for close to 5000 MW of power projects are close to finalisation.
Companies like Reliance Energy, and CESC are likely to set up power projects in the state.
The Orissa state is soon to tie-up with the Dubai government for investments for infrastructure development. These would include roads and ports.
Further, the state is also planning to develop its coast line. The officials said Orissa is taking a cue from the Gujarat government for development of ports.
The state has over 400 kms of coast line. The government will soon get in to an offensive to attract port companies to set up deep water ports in the state.
The development of ports is essential for the state as many of the industries that are setting up capital-intensive projects will use the production facilities to cater to the export market. An underdeveloped maritime infrastructure may discourage industrial investors, said an official.
FDI top on Maoists' radar in Orissa
Financial Express, BHUBANESWAR
12th April 2006
Naxalites, belonging to the Communist Party of India-Maoist Group, are now training their guns on foreign direct investment or FDI. This is evident by the recent demands made by naxals after the abduction of two officials and their release later. The key demand was a ban on entry of multinational companies (MNCs), along with four other demands.
"MNCs like Posco should be stopped", naxalite leader, Sabyasachi Panda, alias Sunil, who master-minded the R Udayagiri siege on March 24, said in an interview to two TV channels deep inside the forest. According to him, the government was showering undue favours on MNCs.
Kalinga Nagar tribals agree to meet CM
Pioneer News Service/ Bhubaneswar
12th April 2006
For the first time, the Kalinga Nagar tribals agreed to meet Chief Minister Naveen Patnaik in order to find a solution to their ongoing agitation.
The tribals, under the umbrella of Visthapn Birodhi Manch, had been continuing their road blockade since January 2 when 13 tribals were killed in police firing at Kalinga Nagar. The road blockade completed 99 days this Monday.
In a bid to persuade the agitating tribals to meet the Chief Minister, Jajpur district collector Arabinda Padhi met them on Monday and held discussions. Earlier, they had refused to talk to the Chief Minister, but this time, they did agree. However, the tribals urged the district collector that the Government must fulfil their three-point charter of demands, which included handing back the severed palms of the deceased tribals, suspension of the then collector and superintendent of police and withdrawal of cases lodged against the tribals.
It may be noted that the tribals' agitation is gradually losing momentum. About 400 tribals had earlier met the Chief Minister and urged him to take steps for welfare of the Kalinga Nagar tribals. They had also alleged that a few NGOs were instigating the tirbals.
Impact of Posco port is under study
Deccan Chronicle, Bhubaneswar, April 10: The request of Pohang Steel Company (Posco) for a separate port facility near Paradip port in Orissa's Jagatsinghpur district is being examined both by the Centre and Orissa government and the findings of the study, being conducted by an expert agency, are awaited. This was informed by the chairman of Paradip Port Trust (PPT) K. Raghuramaiah here on Sunday evening. The study to find the environmental and technical impact had been entrusted to the Pune-based Central Water and Power Research Station (CWPRS), he said. The CWPRS is expected to submit its report within a month or two.
The South Korean steel major has planned to set up a 12-million tonne steel plant near Paradip with an investment of Rs 52,000 crores. The company has also proposed to build a captive port near Jatadhari rive mouth, about seven km south of the existing port at Paradip. The PPT chairman stated that the impact of littoral drift on the Paradip port, if another port came up nearby on the same coast, required to be studied carefully before the decision was taken.
"Paradip has been experiencing erosion of the coast on the northern side and accretion on the southern side and how nature will behave if the new port comes up is the question," he said. "But we will be very happy if the Posco project comes up near Paradip," the chairman said. The port township had lost about 500 acres of land due to coastal erosion, while a new area of about 430 acres had been created due to accretion, the PPT deputy chairman Subrat Tripathy said.
Environmentalists and a few experts have expressed their concern over the possible impact of the proposed Posco port on the Paradip port. They apprehend that the existing port, which is one of the 12 majors ports in the country and currently under stress, might be affected if another port comes up in the vicinity.
Nalco meet discusses fund use
Statesman News Service ANGUL
10th April 2006
Nalco convened a Jansampark Sibir yesterday for the first time at its auditorium to where all the representatives of local bodies in its peripheral areas have come to discuss on how to spend the money allotted by the company in their respective areas. In the past, Nalco would provide the money sought by the district authorities and keep aloof from the developmental works. Everyone at the meet was unanimous in their view that though a whopping Rs 30 crore was spent by Nalco till date from 1986, there is no trace of developmental works. Water supply, health facilities and roads are still issues in the localities around Nalco plant. While blaming the defective planning and improper implementation for the lesser development, Angul collector Suresh Kumar Basista identified five areas where thrust must be given. These are drinking water, roads, health, school and plantation. The collector exhorted the people to use the fund for a common cause in priority sectors rather than for personal benefits. The executive director of Nalco, Uma Ballav Patnaik, talked about Nalco's achievements and its social obligations. Besides the zilla parishad chief, Barun Sahu, Banarpal block chairman Chhabi Garnaik, Angil NAC chief Purna Rout, zilla parishad members, sarpanches and samiti members also participated in the discussion.
Tisco to expand Orissa ferro alloys unit, add power unit Project cost could go up to Rs 100 crore
Business Standard, Kolkata
12th April 2006
The ferro alloys & minerals division (FA&MD), a profit centre of Tata Steel, is in the process of doubling capacity of its ferro chrome plant at Bamnipal in Orissa and adding a captive power plant.
The investment in capacity expansion would be to the tune of Rs 100 crore and the captive plant could cost Rs 200-250 crore.
P Roy, executive in-charge, FA&MD said, the company had already started contracting, ordering for the project and was expected to be completed over the next 18 months.
The capacity of FA&MD own plants was to the tune 50,000 tonne, which was being increased to 110,000 tonne.
Apart from the plant at Bamnipal, FA&MD has a plant at Joda, as well.
Roy said, the investment in such projects varied widely but Tata Steel was putting up facilities complete with ancillaries and hence was estimated to cost Rs 100 crore.
Roy said, the F&MD handles around 120,000-130,000 tonne ferro chrome out of which around 50 per cent was conversion.
He said that the market for ferro chrome was currently buoyant but would be shortlived.
"A number of furnaces have been taken down in South Africa so there is a demand-supply mismatch now but supply may catch up in August-September. So, the buoyancy is expected to last only one quarter" explained Roy.
Prices of long-term contracts internationally went up on April 1 by around 7.25 cents per pound.
The power plant would have a capacity of 60 MW, which would result in huge cost savings.
Electricity accounted for 45-50 per cent of the cost and was still going up.
The cost per unit would be Rs 1.90 as against the buying rate of Rs 2.45 now.
However, Tata Steel would have to fork out much less for electricity in South Africa, where the company was setting up a ferro chrome plant.
Roy said, the cost there would be 80-90 paisa per unit.
Ground breaking for the project would be in May.
Although chrome and manganese form the mainstay of FA&MD's business, it also deals with iron ore, dolomite, coal, coke, other ferro alloys and minerals through various national and international business partners in order to provide a comprehensive package to customers.
The business turnover of FA&MD was around Rs 1,500 crore in 2004-2005.
Govt threatens to cancel MoUs of five companies Pioneer News Service
Bhubaneswar
12th April 2006
The Orissa Government has threatened to cancel the Memorandum of Understanding (MoU) with five companies. Officials said that despite repeated requests, none of the companies have taken any steps for land acquisition and did not apply for the necessary clearance from the State Pollution Control Board. It may be mentioned here that all the five companies have signed the MoUs nine months back, but no progress was made in this regard yet.
The companies are AML Steel and Power Limited, Sunflag Special Steels Limited, Stats Steel India Limited, Sterlite Iron and Steel Co Limited and Maharashtra Seamless Limited. The companies signed the MoUs to produce 10.965 million tonne at an investment of 15,910 crore.
While AML Steel and Power Limited signed the MoU for setting up a plant at Kalinga Nagar at an investment of Rs 206.67 crore, and Sun Flag Special Steels India Limited at Bomlai, Sambalpur at an investment of Rs 915 crore, Stats Steels India Limited signed the MoU to set up a plant at Tangi with an investment of Rs 855 crore. Likewise Sterlite Iron and Steel Co Limited signed the MoU to set up a plant at Palaspanga, Keonjhar at an investment of Rs 12,500 crore and Maharsahtra Seamless Limited at Kalinga Nagar at an investment of Rs 450 crore.
Sources said that on the other hand, 21 companies are going to produce steel by the end of 2006. Eleven companies have already utilised 25 per cent of their project cost while 10 other companies made remarkable progress. These companies are Nepaz Steel, Arati Steel, Maheswari Steel, OCCL, Scaw, ASML, Metalic Auction Integrated Steel, Deepak Steel, Bhusan Steel and Bhusana Steel Limited Company, Visa, SIL, SPS, Ariyan, Patnaik Steel, Rathi Enterprises, Viraz Steel, Jindal Stainless and Estate Steel.
Environment Ministry clears uranium project at Nalgonda
Project will not endanger people's health, says UCIL official
25-member team visits uranium project at Jaduguda Government to set up project with people's consent Project to spell success for Pulivendula constituency
The Hindu, KADAPA
12th April 2006
Central environmental clearance is accorded to the uranium project proposed to be set up in Nalgonda district and two other places, Uranium Corporation of India Limited (UCIL) Chief Executive A. Madhusudana Rao said on Monday.
Speaking at a meeting at Officer on Special Duty's office at Pulivendula, Mr. Rao ruled out fears that uranium project would endanger people's health and degrade the environment. Uranium project at Jaduguda in Jharkhand functioned since 28 years, but no such problems arose, he asserted.
Recent tour of a 25-member delegation including villagers to the uranium project at Jaduguda in Jharkhand dispelled notions that it would endanger public health and degrade the environment, Kadapa MP Y.S. Vivekananda Reddy reiterated. The MP said Communist parties and public organisations that were opposing the proposed uranium project in Vemula mandal, would be taken to the project at Jaduguda, if they wished to gauge the facts, he said.
Inspection of plant
Twenty-five villagers of Mabbuchintalapalle, Thummalapalle, Rajukuntapalle, Bhoomayagaripalle and Kottala who returned from their visit to Jaduguda in Jharkand were present. The delegation inspected the uranium plant, mineral extraction and effluent dumping yard, villages, habitations, schools and hospitals in the vicinity, Mr. Vivekananda Reddy said. The Government would set up uranium project in Vemula mandal with the people's consent, the MP asserted.
Fears baseless
Vemula ZPTC member M. Raja Reddy said fears of people of Thummalapalle on the project were unfounded. Uranium mines at Nawapahad and other nearby places were being tapped since 1958, he said. The Kadapa team went 140 metres deep into the mines and interacted with employees, women, school students and doctors, he said. Employees working for the last 30 thirty years said they never suffered any ailments.
People of six villages in the vicinity of the uranium project at Jaduguda said they hardly suffered health problems, including those living in a village near the effluent dumping yard, he said.
Nearly 4,000 children of various schools were hale and hearty. Pulivendula constituency will witness unprecedented development if uranium project came up, he said.
Meedipentla sarpanch M. Nagi Reddy said no health hazards cropped up at Jaduguda in the last three decades.
Brahmam Reddy of Mabuchintalapalle and MPTC member Raghavendra Reddy said people, environment and resources were not affected by the project.
India needs 1 lakh tonnes uranium, says Kakodkar
Special Correspondent, The Hindu
11th April 2006
HYDERABAD: Atomic Energy Commission chairman Anil Kakodkar has underlined the need for expediting uranium exploration in the country to meet the ever-increasing demand for energy.
While India has an estimated 78,000 tonnes reserves as of now, it will require another one lakh [100,000] tonnes of uranium to feed its reactors in the near future, he said expressing hope that the required reserves would be explored within four years.
Participating in a meeting of the Indian Geophysical Union here on Monday, Mr. Kakodkar said the Atomic Minerals Division of the Department of Atomic Energy had launched a major initiative to explore uranium.
The AMD was hopeful that high-grade ores with 10 to 12 per cent uranium would be found at a depth of more than 1,000 meters. The country was at present extracting uranium from ores that contained less than one per cent of the metal.
Consortium
The department had formed a consortium of AMD, Electronics Corporation of India and Indira Gandhi Centre for Advanced Research to indigenously build systems that could detect deep, concealed deposits. It was likely to be developed within two years. The department was planning to outsource most of the exploration work to public and private companies to bring quick results as ``we have no time to lose,'' he said.
On the other issues, he said that the department is working out modalities for setting up its second facility at Visakhapatnam for further expanding the research and development in atomic energy field. Stating that work on eight more reactors at various places across the country was progressing at a brisk pace, he said that the reactors were being constructed with a site-specific earthquake resistant design.
DAE plans to involve private sector in uranium exploration
Hindu Businessline, Hyderabad
10th April 2006
The Department of Atomic Energy (DAE) will outsource exploration activities to private sector in its bid to find larger deposits of uranium to fuel its ambitious nuclear power programme, according to Dr Anil Kakodkar, Secretary.
The country needs, around 100,000 tonnes of uranium in the near future to sustain the growing nuclear power projects. Currently, the country has confirmed reserves of 78,000 tonnes, he said while delivering a lecture at the Indian Geophysical Union (IGU) meeting.
Dr Kakodkar said that it was a big challenge to the Atomic Minerals Division (AMD), the National Geophysical Research Institute (NGRI), Uranium Corporation of India Ltd (UCIL), etc., to intensify exploration and establish good quality uranium.
To supplement their efforts, it has been decided to involve the private sector in areas like data collection, utilisation of modern techniques, and processing, he added. He said that uranium shortage was not the issue on which India signed the nuclear deal with the US; "we are looking at a larger energy security and expansion of civilian nuclear programme. We already have eight new reactors under implementation, the two Russian reactors at Koodankulam are progressing well and have plans to reach 20,000 MW by 2020, which means a large demand for uranium and resources."
Jharasagdu district is where the UK devil, Vedanta, plans to set up a huge alumininum smelter...
Assess eco damage before NOC issue: Panel
http://www.newindpress.com/NewsItems.asp?ID=IEQ20060407011256&Topic=0&Title=ORISSA&Page=Q
7th April 2006
BHUBANESWAR: The Assembly Committee on Environment headed by Speaker Maheswar Mohanty has observed that rapid industrialisation of Sambalpur and Jharsuguda districts posed a serious threat to environment. So it called for proper assessment of damage to environment before giving no-objection certificates (NOCs) to industries.
The Committee visited several areas in the two districts to make an on-the-spot assessment of the pollution control measures taken by different industries and mines. It has recommended that adequate plantation should be undertaken in the periphery of Talasira coal mines in Sambalpur district to arrest soil erosion.
Polluted water of the mines should be channelised to sumps through drains to protect the catchment area of Hirakud, the committee said in the interim report tabled in the Assembly on Wednesday.
The Committee observed that adequate effluent treatment facilities should be installed by Bhusan Integrated Steel Plant. It advised the company to dispose of the fly ash generated by the factory and solid waste like slag to brick manufacturing units and cement companies.
The Lazkura and Samaleswari open cast mines of Mahanadi Coalfields Limited (MCL) pose serious threat to environment because of accumulation of dust along the mine roads. It observed that plantations undertaken in and around the areas of mining operation were not sufficient.
Besides, illicit felling of trees continues unabated in the old plantation site of MCL. Fly ash from the IB thermal plant of the OPGC is not only polluting the air of the locality but creating a layer on the water of nearby village ponds. Most of the wells and tube-wells go dry in summer, causing acute scarcity of drinking water for the local people, due to deep digging of canal connection by OPGC authorities.
The committee recommended that ponds and tanks of nearby villages should be treated to make water free from contamination and fit for human consumption. Pipe water supply should be made available by the OPGC authorities on top priority to the villages where there is a threat of contamination and scarcity during summer.
Besides, regular health check-up camps should be organised by the OPGC in the periphery areas of the plant to provide minimum health care to the inhabitants, it said.
Plantation work in the areas of operation of MCL and OPGC should be taken up by the Orissa Forest Development Corporation (OFDC). The Committee observed that the DFO and the district administration should cooperate on the issue.
It recommended that plantation of fruit-bearing trees should be taken up by the district administration in the vacant land on a massive scale.
Job demand halts UCIL mining
The Telegraph (India), Jamshedpur
30th March 2006
Protests today marred the functioning of the Turamdih and Banduhurang mines, Uranium Corporation of India Limited (UCIL) properties, when a group of displaced people demanded employment in the company, reports our correspondent.
UCIL sources said villagers, who were displaced when the mines were started, gathered and started claiming that they were not given the promised compensatory job. Instead, they added, some other people were awarded this employment. One Anil Samant, under the banner of the Turamdih Visthapit Samiti, led the agitation.
But UCIL officials rubbished the claim and added that certain "outsiders have influenced" the villagers and are making them protest.
The mines were started last year.
Global majors keen on India's new exploration blocks
NewKerala, New Delhi
12th April 2006
Prospects of more oil and gas finds in India have aroused considerable enthusiasm among global energy majors about new exploration blocks being offered in the country, Petroleum Minister Murli Deora said here Tuesday.
Back from a road show abroad to promote 55 exploration blocks offered for bidding under the latest New Exploration Licensing Policy (NELP) -VI round, Deora expressed optimism that global energy majors like Chevron and ExxonMobil would bid singly or jointly with other companies.
"For the first time all major oil companies including Chevron and ExxonMobil have expressed interest in acquiring data packages of India's sedimentary basins," said Deora.
"Given that over Rs.400 million worth of data have already been sold to companies worldwide, we are optimistic of achieving a milestone of Rs.1 billion through sale of data," the minister said.
During the NELP-V round, which concluded in December last with the award and signing of product sharing contracts for 25 exploration blocks, the Directorate General of Hydrocarbon (DGH) had sold data worth Rs.200 million, which has already been surpassed.
In fact, some global majors are already in the country to study investment opportunities including in green-field refinery projects, said Petroleum Secretary M.S. Srinivasan.
Declining to disclose the companies, Srinivasan said that following the road show in London, some of the companies were in India to study investment opportunities including in the upcoming Bina Refinery in Madhya Pradesh.
Gas and oil discoveries in the last five years and India's investor-friendly rules have led to the increasing keenness of energy majors to invest in Indian exploration activities.
"In the last five years we have been able to add 650 million tonnes of oil and oil equivalent gas (O+OEG) to our in-place reserves. Out of this we should be able to recover about 50 percent of the reserves. On a conservative basis we should be able to recover at least 30 percent or 250 million tonnes O+OEG," said Srinivasan.
Most of the new finds in India had yielded gas reserves, he said.
In the NELP-VI, with majority of the blocks being offshore India expects to see investments of over $7 billion in the next 24 months of exploration activities, which is sizeably more than about $1.7-2 billion investment flow expected in the NELP-V, the official said.
In addition, India has found encouraging reserves from blocks awarded for exploration of coalbed methane.
"From next year, our first commercial production of coal-bed methane is set to begin and yield 20 million cubic metres per day of methane gas which is about 3.5 million tonnes of oil equivalent," said Srinivasan.
Because of the low pressure of coal-bed methane, it is expected to be utilised locally, the official said.
Being a greenhouse gas, believed to be responsible for climate changes, Srinivasan said the petroleum ministry was working with the coal ministry to formulate new guidelines on the basis of rules in various countries where extraction of coal-bed methane prior to mining of coal is mandatory.
The rich potential for coal-bed methane in India saw considerable interest in the new exploration blocks being offered in the latest round for which Minister of State for Petroleum and Natural Gas Dinsha Patel had led a road show to Australia.
Indian miners, traders ship out iron ore fines to enjoy soaring global price
ExpressIndia, Kolkata
26th March 2006
Circumventing the restraint on iron ore exports, Indian miners and traders have sought to cash in on the ore's soaring global price by shipping out iron ore fines. Reports from various ports reveal that the traffic of fines has been steadily climbing and has not been deflated by any of the controversy crowding iron ore exports. The Haldia Port for one, given its proximity to the big mines of Jharkhand and Orissa as well as in its strategic positioning with regard to China - the prime destination of the fines, has certainly gained from this boom time. It expects to close the current financial year with cargo handling volume of 7.8 million tonnes of iron ore fines, more than last year's 5.4 million tonnes.
The 44 per cent spurt in its iron ore fines handling has significantly contributed to pepping the port's traffic, which is estimated to close the year at 41.5 million tonnes (36 million tonnes)."On an average, we shipped about 6.5-7 lakh tonnes of iron ore fines every month," sources at the Haldia Port informed. Haldia, today contributes over nine per cent of the country's iron ore exports, where all its consignments are in the form of fines, officials revealed. What is more interesting is all of Haldia's exports are travelling to one destination - China.