It may be recalled that the Supreme Court had permitted mining leases in category A and B mines in April this year. There were 45 mines in category A and 49 in B. In order to facilitate work to recommence the operations, the department of mining held individual meetings with the above category lessees in Karnataka.

While the mines in Karnataka in the above categories can commence their work, subject to compliance of required formalities, mines in Goa are still under the ban. Out of the above as many as 15 mines had commenced their operations and have mined about five million tonnes of iron ore in addition to the production of National Mineral Development Corporation.

NMDC has produced 12.89 million tonnes of iron, during April to September 2013 with Karnataka contributing 4.44 million tones and Chhattisgarh 8.45 million tonnes. In order to encourage production and supply of iron ore to starving steel mills and sponge iron producers, Karnataka state government sought approval from the Central Empowered Committee to raise iron ore production of certain category A mines, as the Supreme Court has capped it at 30 million tonnes for the year. Actually, local requirements are estimated at 32 million tonnes 36 million tonnes. But, so far production is down and is estimated at 21 million tonnes only.

Since the Supreme Court had cancelled all 51 mines in Category C, CEC is awaiting the reclamation and rehabilitation plans of category A and B mines, so that a final decision can be made.

Assuming a favourable order from CEC, production could reach only 25 million tonnes to 26 million tonnes, leaving a shortfall of 4 million tonnes to 5 million tonnes. This will affect the overall production and any plans for export will have to be postponed for the time being.

The Department ofMines and Geology have also found that, typically, 70% of the iron ore mined is in lumps and only 30% are minimum fines. As such, most steel mills in the state have set up sintering plants and use only iron ore fines in blast furnaces. As a result, NMDC has an unsold stock of more than 2 million tonnes of lumps. They now have to either find the means to use them, or look out for an overseas buyer to export.

Among the leading players in the iron ore mining, Sesa Goa, now part of Sesa Sterlite, stopped mining two years ago as per Supreme Court Directive. It has now secured the work permit from the Ministry of Environment and Forests to commence its operations in Chitradurga district. This permit is for only year only.