Mesco to get a third of Malangtoli iron ore mines - Report
ET reported that the Odisha government has recommended 457 hectares of the Malangtoli iron ore deposit, or about one-third of the original mine area, to its long time claimant Mideast Integrated Steel -the flagship company of Mesco Group.
According to officials in the know, the state has agreed to issue only as much iron ore to the company as it requires for its existing 1.2 million tonnes pig iron plant in the industrial estate of Kalinganagar in Jajpur.
Ms Rita Singh MD at Mesco, applied for the Malangtoli iron ore mine back in the 90s when she ventured to start two steel plants in Odisha. According to company officials, the Biju Patnaik-led government in 1996-97 had recommended the almost 1,500 hectares with, what the company estimated, nearly a billion tonnes of iron ore for Mesco and the Centre had approved the same in 1999.
Mesco's full-time director Mr Priyabrat Patnaik added “But it took a good six years just to get the area demarcated. And, accordingly, there was added delay due to the lack of clarity on what was the forest area that needed approval.”
The iron ore mine was to feed both the pig iron plant which sits on 584 acres and Mesco Kalinga, a steel plant for which 1,700 acres had been allotted in Jajpur. In 2003, however, the state government cancelled the project and redistributed a part of the land to other firms such as Jindal Stainless and Visa Steel. An area of 800 acres remains sub judice. Since then Mesco has managed a turnaround. Back in the 90s, it struggled to retain creditors' trust as it raised money from the primary market, but failed to sustain several of its new ventures such as shoes, pharmaceuticals and shipping. But now, despite its current challenges with subdued pig iron prices, Mesco is in a place far removed from its troubled past with its iron ore leases, railway siding and near debt-free balance sheet.
Earlier this year, Mesco bought out Maithan Ispat integrated steel plant located adjacent to its Kalinganagar plant for INR 1,160 crore, which will help it produce billets, beams and section beams and tap into the predicted demand from infrastructure projects.
Mesco already has environmental clearance to raise its own iron and steel capacity to 3.5 mt. It has a non-captive iron ore mine, Roida mines, at Barbil, with annual capacity of 3 mt.
Source : Economic Times