Projected opportunities galore from corporates, but Rayagada misses the bus

Dr.Badal Tah,Odishabarta

Rayagada, June 27: Mega multinational companies like Aditya Birla Alumina Refineries of Hindalco Industries Limited, Pioneer Aluminium Industries Limited, Vedanta, Utkal Alumina International Ltd(UAIL), Adani, etc are exploring possibilities of their industrial intervention or expansion in Rayagada. Vedanta Chairman Anil Agarwal’s recent announcement of investing one lakh crores rupees in Rayagada district has raised aspirations of Rayagada residents. Aditya Alumina’s Rs.11000 crores Aluminium Refinery & apparel factory at Kansariguda, Kashipur has also raised hopes. Adani’s assurance to set up a medical college in the district and an integrated green field alumina refinery using the captive bauxite mines at SashuBohumali plateau has also kindled hopes & aspirations. As there are issues pertaining to captive bauxite mining in Niyamagiri hills, Vedanta has made agreement with Govt for Sijimali bauxite mines in boarders of Rayagada and Kalahandi.

Pioneer Aluminium Industries Ltd situated in Ankapalle near Visakhapatnam is eyeing bauxite ores from Odisha Mining Corporation’s(OMC) Kodingamali Bauxite mines in Kakirigumma, Laxmipur block of Koraput district.

Out of all these companies, UAIL of Birla fame is fully operational. There are pertinent issues for Vedanta to make Sijimali bauxite mines operational. Vedanta carrying ores by road from Kodingamali mines, which is around 150 kms away from its refinery at Lanjigarh, Kalahandi has escalated the cost manifold. Adani is yet to make a dent. Aditya Birla Alumina Refineries has no captive mines of its own though Kodingamali mines is just 1 km away from its refinery to be established at Kansariguda. And there is inordinate delay in making its refinery operational.

Kodingamali mines has become the hotspot of controversy and at the centre stage as Aditya Birla, Vedanta and Pioneer- all three have shown keen interest to take ore from the said mines. In the buffer zone of Kodingamali mines, there are 12 protected forests and 6 reserve forests. On 1.2.1999, OMC applied for mining lease amounting to 715.075 ha for 30 yrs. Subsequently, during 2008 it changed its application for 447.25 ha & then 428.31 ha. After a GPRS estimate the lease amount finally boiled down to 428.075 ha for 50 years

As Pioneer Ltd is not getting bauxite ores from AP mines and it has already established the refinery plant at Ankapalle, it is interested to take bauxite ores from Kodingamali, which is almost 250 kms from the refinery.

Though the cost will be escalated, there is a compulsion. But recently the present Congress MLA Pabitra Saunta and MP Saptagiri Ulaka, Ex-MP Jhina Hikaka, through a press conference, warned OMC to sell ores only to local companies, who will have refineries in Odisha. Congress MLA TaraprasadBahinipati raised questions in Odisha Assembly and demanded that the mines be leased to local companies. So, logically they were against Pioneer Aluminium Industries Ltd and favoured either Aditya Birla Alumina Refineries or Vedanta. As Vedanta has now a captive mines at Sijimali, though of course with issues, logically the said MLAs & MP’s demand boil down to grant of lease to Aditya Alumina.

Initially the mines was leased out to OMC for thirty years. In the pre feasibility report for expansion prepared by OMC, it mentions the life of the mine to be 12 years. Interestingly enough, Aditya Birla in its pre-feasibility report to Govt also mentions getting bauxite ores from Kodingamali mines, which is leased to OMC now for 50 years. Though the process of MOU, public hearing by OMC, environment clearance from GOI(The proposed site by Hindalco was already awarded environmental clearance vide Letter No J-11011/141/2004/ IA.II dated 18.03.2006), forest clearance, sanction for water withdrawal, etc started since 2005, it got extremely late because of obvious reasons. During 2011 Hindalco also facilitated gram sabhas in villages to be affected. Unfortunately, on 18.2.2015, Odisha Govt cancelled agreement with Hindalco because of joint venture issues. OMC started selling the ores to Vedanta.

There are lots of confusion as far as bauxite reserve vis a vis extraction is concerned. As per environment clearance issued to OMC on 28.5.2008 by Ministry of Forests and Environment, GOI, there is a reserve of 66 million tonnes of ores and it will last for 22 years at the rate of 3 MillionTonnes Per Year(MTPA). As per reports of OMC, the reserve is 77.5 million tonnes as on 1.11.2017. In the amendment letter from GOI dated 24.11.2017, OMC was granted for 6 MTPA ore extraction from 3 MTPA earlier &drawl of 400 KLD[4 lakhs litres per day] of water from Patagarah river for mining activities. So, logically the mines should last for 11-13 years. In the pre-feasibility report of Aditya Birla submitted to Ministry of Environment, Forest & Climate Change, GOI during 2020 , it is mentioned that the refinery will require 9.3 MTPA ores to produce 3 MPTA of alumina. And if ore is supplied to Aditya Birla as per it’s requirement, the Kodingamali mines will hardly last for 7-8 years.

It is well known fact that OMC was extracting ores from Kodingamali mines though mining contractor Mythri Infrastructure Ltd since last 8-9 years at the rate of at least 1 to 2 MTPA and supplying to Vedanta. So, there is now hardly 40-50 millontonnes reserve left in the mines. And there are three competitors –Birla, Vedanta and Pioneer. Though the mining in Kodingamali will hardly last for a few years, the lease to OMC is given for 50 years !!! Aditya Birla Refinery’s project life cycle is 30 years !Mine life cycle is 12 years !Finally the actual reserve is for 7-8 years !!

Amidst all these competitions, a potential corporate rivalry may not be negated. Since the MOU with Govt during 2005, project’s environment

learance in 2008 and water clearance in 2006, Aditya Birla has moved in a snail speed. It has already taken almost 20 years and the refinery is yet to be operational. The strategy of Vedanta’s rupees one lakh crores investment in Rayagada is opaque. No one now talks of Adani regarding establishment of a Medical College. Will Pioneer Aluminium Industries Ltd be beneficial to Rayagadalocals ? Nobody knows the answer. Govt must intervene to take the residents of Rayagada out of this fix and crossroad.