UPDATE 1-India PM: POSCO to start work on steel plant in coming weeks – by Krishna N Das (Reuters India – January 16, 2014)

http://in.reuters.com/

NEW DELHI, Jan 16 (Reuters) – South Korea’s POSCO will be able to start work on its planned $12-billion Indian steel plant over the coming weeks, India’s prime minister said on Thursday, ending an eight year delay for environmental and legal clearances.

Manmohan Singh said the firm’s request for an iron ore mining licence – the final regulatory hurdle for the project which would be the biggest foreign direct investment in India – was at an “advanced stage of processing”.

The 12 million-tonnes-per-year plant in the eastern state of Odisha, formerly Orissa, will help world No.4 steel producer India to expand output.

India produced 77.6 million tonnes of crude steel in the past fiscal year, a fraction of top producer China’s nearly 800 million last year. India’s total iron ore reserve was estimated at 28 billion tonnes as of 2010 by the Indian Bureau of Mines.

India’s new Environment and Forest Minister Veerappa Moily last week gave approval to the plant but asked POSCO to spend 5 percent of the total investment on social commitments, which would raise the project’s cost to $12.6 billion.

South Korean President Park Geun-hye’s current visit to India seems to have pushed forward the project that has been hobbled by the delays in getting clearances, acquiring land and obtaining an iron ore mining licence.

“I am very happy that the large-scale POSCO steel project in Odisha is set to be operational in the coming weeks, following the revalidation of its environmental clearance,” the Indian prime minister said after a meeting with Park, referring to the start of construction work for the project.

“Grant of mining concession for the project is also at an advanced stage of processing.”

POSCO is expected to receive a prospecting licence, which is generally valid for three years and after which a prospector needs to apply for a mining lease.

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