Odisha delays bauxite auction fearing tepid response; mulls reserving the blocks for OMC

It has been reported that the Odisha government is yet to put the state’s bauxite blocks into auction. According to the Ministry of Mines website, till now, six bauxite blocks have been offered for competitive bidding this year and those are all located in Maharashtra. Odisha government has not put up any block for online auction despite meeting the criteria set by Mineral Auction Rules 2015. The state boasts 55 per cent of the country’s total bauxite reserves.

It is said that the state government is not expecting a solid response for the bauxite blocks auction. They are banking on iron ore which is a key draw for Odisha because of steel plants and other end user industries.

“In Odisha, Vedanta is the only aluminium producer operating without a bauxite reserve of its own. Its peers- the state run National Aluminium Company (Nalco) and Hindalco have ample deposits to feed their units. So, we feel online auctions of bauxite may not evoke a robust bidding interest”, said an Odisha government official.

Nalco gets bauxite from its Panchpatmalli mines and it has mining rights over Pottangi mine with 75 million tonnes deposits. This is enough for its current raw material requirement in Damanjodi refinery and its future expansions. Hindalco’s Utkal alumina refinery is fed by Baphlimali mines with bauxite reserves, which would last for over 20 years.

The state government is evaluating the option of reserving the bauxite blocks for its mine PSU- Odisha Mining Corporation (OMC).

OMC currently explores bauxite from Kodingamali deposit and the 70 per cent of the bauxite extracted from this mine is supplied to Vedanta’s alumina refinery at Lanjigarh, according to a long-term linkage agreement. The balance 30 per cent is put to electronic auctions.

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