Can use Goa's 8-10MT inventory once ban is lifted: Sesa Goa

Mining in Karnataka and Goa can resume as early as September 2012 if the Supreme Court relaxes its ban, says PK Mukherjee, managing director, Sesa Goa. 

Speaking to CNBC-TV18, Mukherjee says that the Goa mine has 8-10 million tonne of inventory and if it were to be exported soon, it could lead to a huge gain for the country.

Also read: Goa CM says mining may resume in Nov

"Goa is ready as such but even after SC lifts (the ban), state government also has to lift the ban, which was imposed in September (2012). Ministry of environment and forest also has to lift its suspension, imposed on each and every mine. These are the all milestones we need to cross before we start,” adds Mukherjee.

Below is the edited transcript of Mukherjee's interview to CNBC-TV18.

Q: The latest we hear is that the Goa Chief Minister has said that mining may resume in by the month of November, what is the latest that you are picking up in terms of when resumption of mining activities could take place in Goa?

A: Nowadays, all ministers from Goa as well as the ones in the Centre all are talking about resuming Goa mining. Everybody also understands that the matter is in Supreme Court (SC) and unless they lift their order, which was an interim order passed in October 2012 and which has not been heard till date effectively, until then, mining cannot resume.

Hence, I do not want to take any guesses to the timeline but the way the economy is going and the way everybody is talking, everybody understands the importance of mining. Everyone understands the importance of Goa’s mining in the economy of the country, especially at the current moment when 8-10 million tonne are lying around for last one year, which can be exported within a matter of couple of months. This can be a huge gain for the country as a whole and also for Goa’s economy.

Q: It is one-year now, September 2012 was when the ban came in. The SC heard it only once. In that context, can you give us a timeline since hearing has only been done once, are you expecting hearing to be speeded up under pressure from both the central and the state governments therefore at least in 2013 do you think we can see the mining ban going off?

A: As late as last week, SC bench has said that they are requesting chief justice to allot continuous hearing time for 7-8 days. If that happens, I am sure that this embargo can be handled very quickly. Goa is ready as such but after SC lifts also, state government also has to lift the ban, which was imposed in September. Ministry of environment and forest also has to lift its suspension, which they have imposed on each and every mine. These are the all milestones we need to cross before we start.

Q: Even if assuming in the next two months we get some relief on the Goa front, do you think it will still be well into the next fiscal that you see resumption of mining activities in Goa?

A: No, I don’t think so. Within a month or so, we will be able to start more or less at our capacity so we will be able to achieve the runrate. So, if we get four-five months, a consolidated production can come in. There is absolutely no way that we require five-six months to go into that next fiscal year to start our operations.

Q: You said that hypothetically October end, do you have at least some confidence to assume that hypothesis that in two months things could get straightened out?

A: I have a huge confidence that by September we will be able to see the light at the end of the tunnel.

Q: The reason I asked you that is because Karnataka has gotten a go-ahead in April 2013 and you yourself indicated that perhaps the mining would restart in the month of May and June but we haven’t seen any kind of progress on that front just yet, so what is the update with respect to what is happening with Karnataka mining?

A: Once the SC has given the clearance for so called A-graded and B-graded mines, our mine was in B-grade, it will resume very soon and all the approvals will come in fastest way. However, in Karnataka one needs to remember that every mine more or less is involved in forest clearance and we have got entangled into that.

We are at very advanced stage now. I think this quarter itself we will be able to start operation in case of Karnataka. However, Karnataka cannot be compared with Goa because in Goa, the mining is not done in the forest area.

Q: The approved provisional production capacity was 2.29 million tonne per anum for your B-category mines in Karnataka? How much do you think you will produce this year?

A: Yes, our mines have been approved 2.29 million tonne which can be produced in four months, there is no issue.

Q: When do you expect you will start?

A: I am expecting to start anytime in September.