Bizodisha Bureau, Bhubaneswar, June 13: The Odisha government on Saturday recommended the Centre for the grant of Mining Lease (ML) for Sijurumali and Kuturumali bauxite mines to the Larsen & Toubro (L&T), which plans to set up a three million ton aluminum refinery in two phases of 1.5 million ton each at Rayagada.

“We have recommended grant of mining lease for these two mines in favour of L&T, which has agreed to set up set up a refinery unit of at least 1.5 million ton within three years and the remaining 1.5 million ton unit later. We have also asked the company to set up a skill upgrade institute for the locals”, the steel and mines minister, Prafulla Mallick told reporters.

L&T will invest about Rs 12,000 crore in the first phase for setting up of 1.5 million ton per annum refinery, sources said.

However, Vedanta Alumina Ltd, which has entered into a joint venture agreement with L&T, has very little to cheer about as the state government has put a rider saying that the company cannot use bauxite mined from these two mines elsewhere. That means, Vedanta despite having a joint venture with L&T cannot use bauxite extracted from the two mines.

Weeks back, Vedanta chief Anil Agrawal and L&T Group executive chairman A M Naik had met Chief Minister Naveen Patnaik to discuss about the mining lease and other issues.

In 1992-93, L&T was granted Prospecting License (PL) for Sijurumali and Kuturumali bauxite mines. The Company had announced to spend Rs 10,000 crore to set up the plant, but it did not go ahead prompting the state government to refuse grant of ML to it.