Panaji | Aug 18, 2015: A five-member delegation of high-ranking officials of two top Chinese steel mills has arrived in Goa to hold talks with Vedanta mining over purchase of their iron ore. Talks are presently on and an agreement is expected to be signed next month.
Leon Feng, vice general manager of Hebei Jingye group of steel mills, told TOI at Sesa Ghor on Monday that he is confident Vendanta will begin iron ore extraction by October. Speaking through a translator, Feng said that his steel mill is one of the biggest rebar manufacturing companies in the world. "We are very happy that Goa and Vedanta will soon resume mining operations. This is very good news," Feng said.
Asked why he felt this was good news, Feng said that his company had very good relations for over 20 years with Sesa Goa in the past till Vedanta took over that company. But the immediate attraction is that Vedanta will offer much more competitive pricing as compared to other iron ore sources of China, which are Australia and Brazil. One reason for this is that India and Goa are geographically closer to China and cheaper labour and transportation costs.
But Feng stressed that his mill's past experience with Sesa Goa was very good and that Sesa is "very reliable in terms of quality". Hebei group has not dealt with any other mining company from Goa yet and it "trusts" Sesa, now Vedanta. As of now, the mills are not interested in buying ore through the government's e-auctioning due to the price fluctuations involved.
Asked how much iron ore from Goa his steel mill can take, Feng said that there is an annual mining cap of 20 million tonnes in Goa but his company can take all of it. Asked if he could take 40 million tonnes if Goa could supply it, he replied in the affirmative.
The Chinese steel mills are looking for Goan ore in the grade range of between 54 and 57. Current prices vary between $40 to $50 per tonne of ore including ocean freight.
Vedanta officials said that they have resumed mining operations at their Codli mines, which has a capacity of 3 million tons per year and is said to be the largest privately-operated mine in India. It offers direct employment to about 500 persons and contract employment to another about 500, company sources said.
(Source: http://timesofindia.indiatimes.com/)