Orissa files plea in SC against central lock on Vedanta project

Orissa Mining Corporation (OMC) on Friday filed a petition before the Supreme Court challenging an order of the union ministry of environment and forests reversing the earlier environmental clearance given to the Vedanta group to mine for bauxite in the ecologically fragile and tribal-occupied Niyamgiri Hills in the Kalahandi district of Orissa.

OMC, which is owned by the state government, said the union ministry's decision on 24 August 2010 stalling the project was "violative" of earlier Supreme Court orders. A bench comprising justices R V Raveendran and A K Patnaik said the court would hear the matter, but directed that the OMC's application be converted into a writ petition and suggested the corporation file a contempt petition if it thought that the Supreme Court's orders of 23 November 2007 and 8 August 2008 permitting the project had been violated. It then adjourned the case.

K K Venugopal, appearing on behalf of OMC, said the government order was illegal, arbitrary and in violation of the apex court's direction. He said the rejection of environmental clearance for OMC to mine bauxite had stymied the growth plans of Vedanta Aluminium, which had planned to refine bauxite into alumina and subsequently into aluminium.

OMC had entered into a joint venture agreement with Sterlite Industries India for mining at Niyamgiri to feed the Vedanta alumina refinery at Lanjigarh. Sterlite is a wholly owned subsidiary of Vedanta Resources Plc, the London-listed but largely India-focused company. It is owned by the often abrasive billionaire Anil Agarwal, who has often been accused of riding roughshod over environmental and tribal concerns and using the courts to get his projects cleared.

Vedanta wants to dig open-cast mines in the Niyamgiri Hills to feed the alumina refinery it has already built in the area, as part of an $800 million project expected initially to produce one million tonnes of alumina per year. The MoEF last year struck down plans by the OMC and Sterlite Industries on the ground that Vedanta had showed "blatant disregard" for local tribal groups in the eastern state who deem the land as sacred.