Vedanta Resources soars as iron ore mine reopens in Goa

India’s top iron ore exporting state of Goa resumed production on Monday after almost three years and could hit its court-set annual limit of 20 million tonnes this fiscal year itself, its mines director told Reuters.

Vedanta resumed operations with a ceremonial opening at its Codli mine amid a slump in prices. “Three Chinese mills are coming to meet us”. It lifted the ban in April last year but companies had to wait to get environmental and dozens of other clearances from the government. “It will require close cooperation among the industry, the government and other stakeholders to ensure that we can reopen on a competitive basis”, he said.

The government has since cut export duty on low-quality ore to 10 per cent from 30 per cent, mainly to help companies sell Goa’s ore, which contains less than 58 per cent iron. Till date, five mining plans and schemes for the Company’s mines have been cleared by Indian Bureau of Mines and we are awaiting clearance of further 15 plans.

In a statement, Vedanta Resources also indicated that “even as India and in particular miners from Goa look to regain lost markets, iron ore markets/prices are weak and the worldwide trade environment remains challenging”. The miner has received all approvals to restart operation at its Codli and Bicholim mines. Vedanta has produced 0.6 million tonnes of iron ore generating an operating profit of Rs 135 crore.

After three long years the mining operations would resume said Kishor Kumar, Chief Executive Officer, Sesa Iron Ore.

From the 80-plus mining leases, which have been renewed by the state government since the ban, Vedanta Resource’s Sesa Iron ore mining company is the first outfit to restart mining operations.

The resumption of mining will resume the employment of many mining dependent people, the government will benefit from increased revenues and communities will be empowered, ” Kishore Kumar, CEO, Vedanta’s Iron Ore Business, said on the occasion.

The actual mining operations will begin post monsoon around the second half of September, when the rains stop.

In October 2012, Supreme Court had imposed a blanket ban on mining while hearing a petition.