New Delhi, January 31 (Agencies): Posco, the world’s third-largest steelmaker, received approval for its $12 bn factory complex in India, paving the way for the nation’s single-biggest foreign investment 6 years after it was proposed. The South Korean company’s 12 mn metric ton mill, to be built in three phases in the eastern state of Orissa, was cleared with 28 additional conditions including limits on the use of water, the environment ministry said on its website. Approvals were also given to divert 1,253 hectares of forest land for the project and a captive port.
The plant, the nation’s first overseas steel investment, has been delayed since 2005 because of resistance from farmers unwilling to give up their land. The farmers will hold rallies at the site starting tomorrow, Prasanth Paikare, a spokesman for opposition group Posco Prathirodh Sangram Samiti, said by phone from the eastern city of Bhubaneswar in the state. “We’re trying to garner nationwide support for our movement,” said Paikare, who represents 25,000 farmers who will be affected by the project. “There’ll be no land or water left for us to survive.” Posco shares fell 1.7 percent to 454,000 won at the end of trading in Seoul. The stock declined 21 percent last year, compared with a 22% gain in the benchmark Kospi index.
Panel Overruled
The future of the mill came under doubt after 3 of 4 members of a government panel in October suggested that initial permits given to Posco be canceled because of flaws in studies to determine the project’s effect on the habitat. A separate report by Meena Gupta, the head of the panel, asked for conditions to be added to the existing clearances. “How can the minister overrule the panel’s recommendation?” Paikare said.
In August, the environment ministry rejected a proposal by billionaire Anil Agarwal’s Vedanta Resources Plc to mine bauxite at Niyamgiri hills in the same state, hampering a planned $8 bn expansion. ArcelorMittal, the world’s largest steelmaker, is also facing delays for two $10 bn mills, one each in Orissa and in neighboring Jharkhand state. Projects by Tata Steel Ltd., India’s biggest maker of the metal, in the 2 states and in Chhattisgarh, and by JSW Steel Ltd. in Jharkhand have also been delayed on land issues.
The plant, the nation’s first overseas steel investment, has been delayed since 2005 because of resistance from farmers unwilling to give up their land. The farmers will hold rallies at the site starting tomorrow, Prasanth Paikare, a spokesman for opposition group Posco Prathirodh Sangram Samiti, said by phone from the eastern city of Bhubaneswar in the state. “We’re trying to garner nationwide support for our movement,” said Paikare, who represents 25,000 farmers who will be affected by the project. “There’ll be no land or water left for us to survive.” Posco shares fell 1.7 percent to 454,000 won at the end of trading in Seoul. The stock declined 21 percent last year, compared with a 22% gain in the benchmark Kospi index.
Panel Overruled
The future of the mill came under doubt after 3 of 4 members of a government panel in October suggested that initial permits given to Posco be canceled because of flaws in studies to determine the project’s effect on the habitat. A separate report by Meena Gupta, the head of the panel, asked for conditions to be added to the existing clearances. “How can the minister overrule the panel’s recommendation?” Paikare said.
In August, the environment ministry rejected a proposal by billionaire Anil Agarwal’s Vedanta Resources Plc to mine bauxite at Niyamgiri hills in the same state, hampering a planned $8 bn expansion. ArcelorMittal, the world’s largest steelmaker, is also facing delays for two $10 bn mills, one each in Orissa and in neighboring Jharkhand state. Projects by Tata Steel Ltd., India’s biggest maker of the metal, in the 2 states and in Chhattisgarh, and by JSW Steel Ltd. in Jharkhand have also been delayed on land issues.
POSCO says Indian approval boosts its global strategy
Seoul, January 31 (Reuters): India’s decision on Monday to approve a $12 billion steel mill by POSCO will help the world’s No. 3 steelmaker move toward its strategy of raising exports and gaining access to low-cost iron ore. The No.3 global steelmaker’s 12-million-tonne steel project, first announced in 2005, is the centerpiece of POSCO’s bid to expand overseas, amid rising competition at home and as it seeks more self-sufficiency in supplying steelmaking ingredients. Its domestic rival, Hyundai Steel, is boosting output aggressively to increase supply for its affiliate Hyundai Motor, the world’s No.5 auto group and a major client of POSCO. Approval would enable the Orissa government to immediately start acquiring land for POSCO. “The decision will help us proceed with the stalled project, as it will allow us to resume land acquisitions among other things,” a POSCO spokesman said. But POSCO still has a long way to go to complete the Orissa project, since it has yet to receive a separate court ruling on iron ore mining rights from India. POSCO expects that to be decided by early 2012 in order for construction to start.
Seoul, January 31 (Reuters): India’s decision on Monday to approve a $12 billion steel mill by POSCO will help the world’s No. 3 steelmaker move toward its strategy of raising exports and gaining access to low-cost iron ore. The No.3 global steelmaker’s 12-million-tonne steel project, first announced in 2005, is the centerpiece of POSCO’s bid to expand overseas, amid rising competition at home and as it seeks more self-sufficiency in supplying steelmaking ingredients. Its domestic rival, Hyundai Steel, is boosting output aggressively to increase supply for its affiliate Hyundai Motor, the world’s No.5 auto group and a major client of POSCO. Approval would enable the Orissa government to immediately start acquiring land for POSCO. “The decision will help us proceed with the stalled project, as it will allow us to resume land acquisitions among other things,” a POSCO spokesman said. But POSCO still has a long way to go to complete the Orissa project, since it has yet to receive a separate court ruling on iron ore mining rights from India. POSCO expects that to be decided by early 2012 in order for construction to start.
