KUDREMUKH IRON ORE COMPANY
Kudremukh Iron Ore
Company Limited (KIOCL) a public sector undertaking of the Steel
Ministry in Karnataka was established in the year 1976 with a
planned investment of $ 630 million. It is the country's largest
iron ore project for benefaction of low grade Iron Ore. Located
in the Aroli-Gangamoola range in Western Ghats in Chickmagalur
District of Karnataka, KIOCL was born out of a Memorandum of Understanding
singed on May2,1974 between Government of Iran and India for implementation
of the project for production and delivery of iron ore concentrate
to National Iranian Steel Company.
A financial agreement
and a sale and purchase contract were concluded on November 4,
1975, the former for extending credit upto US $ 630 million by
Iran and the latter for production and delivery of 150 MT of Concentrate
beginning from August 1980 by KIOCL. Iran could provide only $
255 as against $ 630 million because of political developments
in that country. The project was, however, completed without cost
and time over-runs with funds provided by Govt. of India. The
timely completion of the project facilitated a saving of Rs. 80
crore. The mine and plant facilities were commissioned in 1980
and the first shipment of concentrate was made in October 1981.
It is the first fully
integrated operation in India stretching right from the mine to
the port and then to export markets; the first large-scale magnetite
iron ore mine in India; the first commercial exploitation of low
grade iron ore and the first iron ore long distance slurry pumping
operation in the country with the pipeline spanning over a stretch
of 67 kms.
When Iran failed
to lift the contracted quantity of iron ore concentrates, KIOCL
developed new markets for its product. The year 1989-90 saw KIOCL
wiping out all the accumulated losses and making a profit for
the first time. The year 1991-92 was the year KIOCL made the highest
profit of Rs. 140 crore. KIOCL continues its profit making record
to date.
KIOCL's workforce
consists of 2279 employees as on 31.3.2002. They have been provided
with amenities such as well planned township, schools, hospitals,
canteens, shopping complexes, sports and recreation facilities,
cable TV networks, parks, temples, churches, mosque, etc, besides
grant of other perks such as advances for purchase of conveyance,
house building, reimbursement of school fees, scholarships, bonus,
incentive, etc.
April 1987 saw a
3-million tonne per annum capacity pellet plant commissioned to
provide diversification for KIOCL's products. The plant is now
exporting both blast furnace and DR grade pellets to many countries
including China, Taiwan, Japan and also to domestic sponge iron
units such as Vikram Ispat, Ispat Metallics, Ispat Industries
and Jindal Vijaynagar Steel Ltd. The capacity of the existing
pellet plant was enhanced to 3.5 Mtpa. Further, with the addition
of a Shaft Pelletising Furnace, the capacity has been further
increased to 4 Mtpa.
In June, 1995, KIOCL,
in association with M/s. MECON and MSTC set up a Joint Venture
Company called M/s. Kudremukh Iron and Steel Company Ltd for implementation
of a project for production of 230,000 tonnes of low phosphorous
and low sulphur pig iron and 50,000 tonnes of ductile iron spun
pipes per annum at Mangalore. Construction of the pig iron component
of the project has been completed. The process of construction
of DISP plant is in progress.
KIOCL was given a
mining lease of 30 years that expired on July 24, 1999. The company
applied for renewal of the lease in July 1998 for a long term
extension for 20 years. But the Government of Karnataka renewed
the lease only for a year. In the meantime they constituted the
Kudremukh National Park and the lease area of KIOCL was excluded
from the notified area of the park. Subsequently when KIOCL applied
for 20 years lease ,the State Government changed its stand and
lease was again extended for one year only.
A non government
organization working in the area filed a case against the Government
of India and the Government of Karnataka against the long term
renewal of KIOCL lease. The Supreme Court in its recent judgement
permitted extension of mining lease till December 2005. The company
is taking further action in the matter.
