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Odisha to increase ore production as mining revenue falls


With revenue collection from the mining sector declining in the state due to different factors including closure of 18 mines as per a Supreme Court order, Odisha government today decided to convene a meeting of lease holders to encourage increase in production of iron ore and disposal of stocked ore.

“We have convened a meeting of mines lessees on November 18. Decisions are made to sell off the stocked iron ore lump …. To make up the gap in the revenue collection,” Steel and Mines Minister Prafulla Kumar Mallick told reporters.

The state has so far (till October) generated mining revenue of only Rs 2,343 crore against last year’s collection in the corresponding period of Rs 3077 crore. The target of mining revenue for the year 2014-15 was Rs 6346 crore, the minister said.

As Iron Ore contributes 60 per cent of the mining revenue, fall in despatch has affected collection, the officials in Department of Steel and Mines said adding that the government was working out strategies to augment the production and dispatch of the minerals.

The total dispatch of iron ore up to September, 2014 has been 22.32 Million Ton (MT) as against 28.47 MT for 2013-14 up to the corresponding period.

This dip in despatch added to the fall in average sale price of iron ore resulting in the shortfall of mining revenue, they said.

Besides the issue of closure of 18 iron ore and manganese mines as per the apex court order, the sale price of iron ore stands at the lowest in last five years.

The price of iron ore sale per ton fixed has also declined. Therefore, there has been decrease of about Rs 200 per ton of iron ore on an average compared to the last year in both lumps and fines.

The Steel and Mines minister Prafulla Kumar Mallick, however, hoped to make up the shortfall as there has been 50 percent hike in royalty on Iron Ore from 1 September, 2014.

There are 36 mines presently under operation for production of iron ore, out of which 29 are non-captive. The production limit as per the approved Environmental Clearance (EC) in respect of these 29 mines is 42.36 MT against which production achieved up to end of September, 2014 has been 17 MT.

With improvement in production and despatch of iron ore, the state government feels that the Revenue Collection shortfall can be bridged, the minister said.



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