The Jharkhand government has offered Mittal Steel an alternate mine instead of the ore-rich Chiria mines for its proposed 12-million-tonne-steel plant in the state, but the global steel player has reportedly said no.
Chief Minister Madhu Koda said: "We have offered the Ankura mines to Mittal Steel. At this point we cannot promise of giving Chiria mines to Mittal Steel as we are fighting a legal battle with Steel Authority of India Limited (SAIL) over it.
"Ankura mines can fulfil the requirements of Mittal Steel."
However, Mittal Steel has rejected the offer. "The Ankura mines will not fulfil our needs. We want mechanised mining which is not possible in that mine. We had visited the Ankura mines along with experts, but it is of no use to us," Sanjeev Sengupta, general manager Mittal Steel Jharkhand, was quoted as saying by local dailies.
Mittal Steel, owned by steel magnate LN Mittal, had recently said there would be no project in Jharkhand if it did not get Chiria mines.
Koda also announced the state government would give land to Mittal Steel, but on certain conditions. The state government wants assurances from the company in the fields of employment, health facilities and education to help the state.
The government's refusal to grant Chiria mines and proposal of giving land tagged with certain conditions indicates that it is getting tough with the company and other investors.
The Chiria mines are a bone of contention between the Jharkhand government and SAIL with both fighting a legal battle over it in the Jharkhand High Court. Chiria mines, located in West Singhbhum district, have 1.4 billion metric tonnes of iron ore.
Last year, Mittal steel had signed an MoU with the Jharkhand government to set up the steel plant with an investment of Rs 400 billion.
Mittal steel wants 600 million tonnes iron ore for 30 years from Chiria mines but the state government has expressed inability to allot the Chiria mines.