POSCO seeks continuance of controversial agreementPublished by MAC on 2005-10-18
Source: Financial Express India
POSCO seeks continuance of controversial agreement
New Delhi October 18
The Indian subsidiary of Korean steel major, Pohang Steel Company (Posco), will seek continuation of controversial iron ore export clause when it signs final agreement to set up its 12 million tonne steel plant with the Orissa government sometime next year.
Talking to FE, Posco India deputy managing director Tae-Hyun Jeong said that this was necessary as iron ore in Orissa traditionally had high levels of alumina unsuitable for use in blast furnace.
"In any case, iron ore exports from our captive mines will take place only after we import better quality of ore in similar quantities here for blending".Mr Jeong said adding, that ore constituted only about 20% of the total cost of steel making.
Posco's decision on iron ore exports comes at a time when opposition is building in Orissa over the controversial clause in the MoU. Even the National Advisory Council to the government, headed by Congress president Mrs Sonia Gandhi, has expressed its concern over the certain clauses in the MoU.
The state government is meeting more opposition now as the Jharkhand government has signed MoU with world's largest steel maker Mittal Steel without any commitment on iron ore exports even for blending purpose.
The MoU between Orissa government and Posco permits the steel company to export 30% of annual production from its captive mines under a swap arrangement.