J Sagar Associates (JSA) and Fox Mandal advised South Korean steel major Posco in the Supreme Court (SC), challenging the Orissa High Court’s decision to set aside the state government recommending a preferential grant to mine iron ore.
JSA Delhi dispute resolution partners Amar Gupta, Dheeraj Nair and Ananya Kumar with senior associate Divyam Agarwal and Fox Mandal Noida senior associate Swati Sinha acted for Posco in the SC.
They instructed senior advocates KK Venugopal and CA Sundaram.
The Odisha government and Geomin Minerals & Marketing had challenged the July 14, 2010 order of the High Court which quashed the notification issuing Posco an iron ore mining licence over 2,500 hectares in the Khandadhar hills in the Sundergarh district, according to the Economic Times.
The licence would aid Posco’s proposed Rs 51,000 crore ($12bn) steel plant near Paradeep, according to the paper. The project is billed as India’s largest foreign direct investment (FDI), according to JSA’s press release.
Amarchand Mangaldas acted for the Bhubaneshwar-based mineral and mining company Geomin Minerals & Marketing, and advocate Shibashish Misra acted for the government of Orissa.
Geomin had submitted before the Orissa HC that it had applied for a mining licence in the same area as Posco, much before Posco, and was not granted the same, according to Telegraph India. It opposed the SC's suggestion to ask the state government to make an assessment of all potential contenders of the licence, because under the Mines and Minerals Development Act only the union government has this power.
Khaitan & Co partner Sanjeev Kapoor acted for Steel major Jindal Steel and Power which had filed an impleadement application before the SC, since its reliefs coincided with that of Geomin.
The world’s fourth largest steel producer has waited eight years to get necessary clearances and licences for its 12 million tonne steel production plant and has already raised investment in emerging countries like Indonesia to make up for its slow progress in India, according to Reuters.
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Prospecting licence enables the holder to prospect or explore the area in order to identify mineable ore deposits, while a mining lease actually permits extraction and carrying away of minerals. A prospecting licence is granted for 2 years and on the completion, the holder may apply for a mining lease if mineable ore reserves are established by prospecting. The holder of prospecting licence has a preferential right over others to the grant of a mining lease.
This judgment was challenged before the Apex Court by all the principal parties, Posco, Geomin and State. While this SLP was pending the Apex Court delivered judgment in Monnet Ipat & Union of India, wherein the State's authority to reserve areas prior to 1987 was settled. After that the outcome of the SLP filed by Geomin was more or less certain. For information of all, the property at stake was a claim to prospect an area, likely to contain 600MT of iron ore , which at today's market rates would be in the range of Rs.1 lakh crore.
The story does not end here. It is very likely that litigation would resume if Centre approves the grant of prospecting licence in favour of Posco. The future of the 12 MTPA steel plant depends on the grant of captive mineral concessions. This steel project when announced was proposed at an investment of Rs. 54,000 crores, the largest single FDI proposal in 2005.
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