Oz mining firm keen on reviving deal

Published: 19th October 2012 12:05 PM  |   Last Updated: 19th October 2012 12:05 PM   |  A+A-

The State Government is seriously contemplating to revive the old agreement with Australian mining giant Rio Tinto for undertaking mining activities in the State.

The three-day visit of Australian High Commissioner Peter Varghese commencing from Friday has brightened the prospects of a fresh agreement. He has sought an appointment with Chief Minister Naveen Patnaik and Chief Secretary BK Patnaik. Rio Tinto’s chief executive (Iron Ore) Sam Welsh will accompany the Australian High Commissioner, the sources added.

Rio Tinto had signed an agreement with the State-owned Orissa Mining Corporation (OMC) for exploration of minerals in 1995, but failed to implement the project due to slump in the international market.

A joint venture company, Rio Tinto Orissa Mineral (RTOM), was floated for exploration of 15 million tonne iron ore per annum from Gandhamardan and Malangtoli mines, sources said.

As the agreement with Rio Tinto had become defunct, the OMC had moved the Orissa High Court to wind up RTOM. However, there is no progress as the matter is sub judice.

Sources in the Steel and Mines Department said the State Government had already prepared a draft for a fresh agreement with the mining major. The draft agreement was under consideration of the Law Department.

Though the State Government through OMC had challenged Rio Tinto’s non-implementation of the earlier agreement in the High Court, it was considering a proposal to explore iron ore in order to meet the demands of the industries in the State.

In case of a fresh agreement with Rio Tinto, the earlier provision of exporting 50 per cent of the iron ore will be deleted in view of the restriction imposed by the Centre, the sources said.

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