Thursday, August 3 2006 16:43 Hrs (IST) - World Time -

Ranchi: Global steel major Mittal Steel will decide next month on whether to go ahead with its proposed 12-million-tonne-steel plant in Jharkhand.

This was conveyed by Mittal Steel representatives during a high-level meeting with Jharkhand government officials here Wednesday.

The decision of Mittal Steel, owned by global steel magnate Lakshmi N. Mittal, to postpone a decision till September is apparently driven by its keenness to be allotted the prime Chiria iron ore mines in the state.

The Chiria mines, located in West Singhbhum district of Jharkhand, has rich quality of iron ore around 1.4 billion tonnes of ore.

Mittal Steel wants 600 million tonnes of iron ore for 30 years for its project. The state-owned Steel Authority of India (SAIL) is presently in possession of Chiria. The Jharkhand government and SAIL are fighting a legal battle over the mines in the Jharkhand High Court.

The case of Chiria mines is likely to be decided this month by the court.

"Mittal Steel seems to be waiting for the outcome of the court verdict. If it favours the government then the company will go ahead with the project and apply for land and other needs," said a government official.

According to a government source, Mittal Steel representatives wanted to know at the meeting whether the state government would allot Chiria mines to it.

The state government officials again told Mittal about the bottlenecks in providing Chiria mines.

"We told them that the state government cannot commit to give Chiria mines till the case pending with the Jharkhand High Court is cleared. We offered other mines where they can take iron ore for the steel project," said an official who was present in the meeting.

The state government delegation was headed by chief secretary M.K. Mandal, while the Mittal Steel team was headed by Sanak Mishra, in-charge of the Jharkhand project.

Lakshmi N. Mittal during a visit to India last month had expressed his unhappiness over the pace of the Jharkhand project. Mittal also announced an agreement with the Orissa government to set up a 12 million tonne steel plant in that state.

Jharkhand Chief Minister Arjun Munda met Mittal in London last week and informed him about the efforts of the state government to push forward the project. He also offered other mines for the project.

Mittal Steel had signed the Memorandum of Understanding with the Jharkhand government for the steel plant with investment of Rs.400 billion in October last year.