Essar Steel Bags Iron Ore Mine in Odisha

4 March 2016

Essar SteelBSE 0.41 % has won the first iron ore mine auctioned by the government, bagging the Ghoraburhani-Sagasahi iron ore mine in Odisha at a premium of 44% of the average price in aggressive bidding involving seven steel firms. The auction is expected to yield Rs 11,328 crore to Odisha state exchequer. The average sale price of set by Indian Bureau of Mines is Rs 1,860.12 per million tonne. Seven steel companies, including Tata SteelBSE 1.40 %, Jindal Steel & Power Ltd, Bhushan Power and Steel, JSW SteelBSE 1.80 % and Rashtriya Ispat Nigam, participated in the auction concluded on Wednesday.

Ghoraburhani-Sagasahi mine, spread over 139.2 hectares, is estimated to have 99.59 million tonnes of reserves.

So far six mines — including four limestone mines, one iron ore mine and one gold mine have been auctioned by state governments of Odisha, Chhattisgarh and Jharkhand, The states are expected to realise total revenue of.`18,107 crore over 50 years of life of these mines, six times more than the royalty that they would have earned if the mines were given without auction.

Earlier, Anil Agarwal-led Vedanta emerged as highest bidder for Baghmara gold mine in Chhattisgarh.

Vedanta had put in the highest bid of 12.55% of Indian Bureau of Mining price of Rs 74,712 per troy ounce.

One troy ounce is equal to 31.10 gram.


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