Vedanta has emerged the successful bidder for the first block of iron ore leases that went under the hammer on Wednesday, marking the beginning of new era in the Goa mining sector .
Goa Chief Minister Pramod Sawant announced the winning bidder on Wednesday evening.
“A new era has begun for the Mining Sector in Goa. The long pending issue of Mining in Goa has come to a practical end. Vedanta is the successful bidder to acquire Block 1, Bicholim in the first phase of auctioning,” the Chief Minister said.
“Employment opportunities will continue to be created and the mining sector will persistently flourish and prosper,” he added.
With this, Sawant said, one of his most important pre-election promises was fulfilled.
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“The opposition kept taunting us saying that we were making empty promises. It was our constant effort to restart mining as soon as possible and several attempts in this direction ere attempted only because we wanted to restart mining as soon as possible,” the Chief Minister said, referring among other things to the botched attempt to restart mining through lease renewals in 2015 that were quashed by the Supreme Court in 2018 bringing mining to a halt once again.
{{/usCountry}}“The opposition kept taunting us saying that we were making empty promises. It was our constant effort to restart mining as soon as possible and several attempts in this direction ere attempted only because we wanted to restart mining as soon as possible,” the Chief Minister said, referring among other things to the botched attempt to restart mining through lease renewals in 2015 that were quashed by the Supreme Court in 2018 bringing mining to a halt once again.
{{/usCountry}}“Goa’s economy is dependent on mining and as a representative of the mining belt I could see first-hand the effects of the mining ban on people,” he added.
With the winning bid, Vedanta regained legal ownership of the mining leases it was operating prior to the mining ban and subsequent decision of the Supreme Court to extinguish the leases.
Vedanta emerged the highest bidder with a bid promising to share 63.55% of revenue . The base price of the auction was set at 25% at the time of notifying the auction. However, when the initial bids were opened revealing the initial price offer MSPL had bid the highest promising 63% revenue sharing with the government. The highest initial price offer formed the base price for the auction when bidding opened on Wednesday.
“The price we have achieved amounts to four times what we were earlier earning through royalty which used to be only 15% of the average sale price as set by the IBM,” Director of Mines Suresh Shanbhogue said.
The winning bidder will be allocated the mine for a period of 50-years as per the prevailing law.
Four blocks are up for auctions , three blocks in North Goa -- Monte de Sirigao, Sirigao-Mayem and Bicholim previously owned by M/s Rajaram Bandekar, Chowgule & Co and Sesa Mining Corporation -- and one in South Goa at Kalay, previously owned by N S Narvekar .
The Bicholim block was the first to go under the hammer on Wednesday. Besides Vedanta, other companies who qualified to participate in the auction included JSW Ltd, Arcelormittal Nippon Steel India, Shri Jagannath Steel and Power and MSP Limited.
As per the procedure adopted by the Goa government at the time of opening of bids, the top five bidders, who are technically qualified for the auction, will be eligible to participate. Since there were five bidders for the first block, all five were eligible to participate in the auction.
The other three auction blocks are scheduled to be up for auction between now and December 21, as per the schedule released by the mines department.
The state government has received 28 bids by 11 companies for the four mining blocks that are going under the hammer in the current lot. The government has already approved another lot of seven blocks for auction in a subsequent auction.
The state expects to hand over possession of the lease to the winning bidder within fifteen days, the chief minister said.
Despite the auctions, mining isn’t expected to immediately resume with the tender document specifying that a successful bidder will have to obtain forest clearances, wildlife clearances, environmental clearances afresh among a list of more than 15 clearances that will be required if mining is to resume.
“The winning bidder has up to three years to begin operations after he is handed over the letter of intent. If not, then the lease reverts back to the government. But we expect that since the same mining company has won the bid once again, we are hopeful that they can secure all the clearances and begin operations within a year’s time,” Shanbhogue added.