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INTRODUCTION
Iron 11
Iron + Manganese 05
Manganese 03
Chromite 11
Limestone 01
Gemstone 04
Besides this, OMC has applied for a number of Mining Leases which
are pending at Government level for consideration.
4. The major minerals mined by OMC are chrome, iron and manganese
ore catering to the requirement of mineral based industries of the
State as well as outside.
5. The growth of OMC has been impressive over these years and today
it stands as the largest State PSU in the mining sector of the country
with a record turnover of Rs. 2085 Crores and profit (Before tax) of
Rs. 1890 Crores in the year 2008-09.
WHY JVC:-
6. In the year 2008-09 OMC recorded 7.8 million tonnes of iron ore
production which accounted for about 10% of the total production of
the State.
7. Almost the entire production of iron ore of OMC came from its
3 major iron ore mines namely Daitari, Kurmitar and
Gandhamardan.
8. Though it has 11 iron ore Mining Leases and 5 iron + manganese
ore Mining Leases, except the above 3 major mines, other Mining
Leases have remained more or less non-operative in recent years.
The main reasons for these Mining Leases remaining non-operative
are listed below:
Production of iron ore by OMC has always been in tune with the
market demand. In the past, there was hardly any demand for iron
ore and therefore production was limited to production to a couple
of mines only. However, due to boom in the steel industries from
2003-04 onwards, the demand of iron ore in the market went up
substantially which forced OMC to step up its production from
3.0 million tonnes in 2004-05 to 7.8 million tonnes in 2008-09.
While OMC could successfully step up its production in the 3 existing
major iron ore mines - Daitari, Gandhamardan, Kurmitar - to meet
the rising market demand, it could not operate other Mining Leases
due to issues relating to various statutory clearances. The market
demand for iron ore is rising day by day due to a large number of
steel industries coming up in the State of Orissa through MoU and
non-MoU routes. Expansion of capacity of existing units is also
adding to the market demand.
As per MMDR Act if a lessee keeps its mining lease non-operative for
a long period of time without any valid reason, the lease standing in
its favour may be withdrawn/cancelled by the competent authority
and would be allotted to some one else. By keeping many of its
leases non-operative, OMC runs risk of losing such mining leases.
i) Advantages to OMC
OMC cannot make these mines operational on its own. By
keeping these Mining Leases inoperative, OMC incurs non-
productive expenses, dead rent, watch and ward,
establishment expenses, etc.
The JV Partner will get access to an iron ore mine which will
assure supply of raw-material to its steel units.
1.
2.
3.
4.
5.
6
7.
Managing Director
CONCEPT NOTE ON OMC ENTERING INTO JOINT VENTURE PROJECTS
WITH MOU STEEL UNITS FOR OPERATING IRON ORE MINES.
INTRODUCTION
Iron 11
Iron + Manganese 05
Manganese 03
Chromite 11
Limestone 01
Gemstone 04
Besides this, OMC has applied for a number of Mining Leases which
are pending at Government level for consideration.
4. The major minerals mined by OMC are chrome, iron and manganese
ore catering to the requirement of mineral based industries of the
State as well as outside.
5. In the year 2008-09 OMC recorded 7.8 million tonnes of iron ore
production which accounted for about 10% of the total production of
the State.
6. Almost the entire production of iron ore of OMC came from its
3 major iron ore mines namely Daitari, Kurmitar and
Gandhamardan.
Production of iron ore by OMC has always been in tune with the
market demand. In the past, there was hardly any demand for iron
ore and therefore production was limited to production to a couple
of mines only. However, due to boom in the steel industries from
2003-04 onwards, the demand of iron ore in the market went up
substantially which forced OMC to step up its production from
3.0 million tonnes in 2004-05 to 7.8 million tonnes in 2008-09.
While OMC could successfully step up its production in the 3 existing
major iron ore mines - Daitari, Gandhamardan, Kurmitar - to meet
the rising market demand, it could not operate other Mining Leases
due to issues relating to various statutory clearances. The market
demand for iron ore is rising day by day due to a large number of
steel industries coming up in the State of Orissa through MoU and
non-MoU routes. Expansion of capacity of existing units is also
adding to the market demand.
8. Since most of the iron ore Mining Leases of OMC remain inoperative
for long years due to want of demand for iron ore in the past,
necessary preliminary field works such as detail exploration,
preparation of Land Use Plan, Mining Plan/Mining Scheme, etc. have
not yet been completed which are pre-requisites for obtaining the
statutory clearances to run the mines such as Environmental
Clearance, Forest Diversion Clearance, Pollution Control Board
Clearance, etc.
9. Though OMC is trying its level best to obtain all required statutory
clearances to make the mines operational, it required a large
number of qualified man-power to complete the field work and
pursue the matter from local administration level to Govt. of India
level for obtaining the approvals. Due to shortage of technical and
qualified manpower - as there has been no substantial recruitment
in OMC for the last _______ years - the efforts of OMC in this regard
are found grossly wanting due to which inordinate delay is taking
place in obtaining these clearances.
Since OMC cannot make these mines operational on its own within a
reasonable time period to meet the rising market demand, OMC may
enter into JV projects with private industrial houses of the State
which will have the following advantages.
A) Advantages to OMC
(iii) OMC and the industrial partner will work in synergy in the
Joint Venture Project. The JV partner can supplement the
efforts of the OMC by bringing in competent person in
completing field works. The JV partner can also pursue various
statutory clearances at every level aggressively with the
batting of OMC and can ensure statutory clearances in time.
(i) The JV Partner will get access to an iron ore mine which will
assure supply of raw-material to its steel units.
(ii) Since the Mining Leases already stand in favour of OMC and
some of the statutory clearances for the Mining Leases would
be already available, the gestation period of making such
Mining Leases operative will be very small.
(a) So far there are 5 Joint Venture Projects where OMC has been
associated. These JV projects have different models as given in the
table below.
1.
2.
3.
4.
5.
6.
7.
Drawing cue from the above JV model the basic features of the
proposed JV model between OMC and industrial houses for operating
and non-operating mines of OMC are listed below.
(b) JV with Whom