Posco''s $12-billion steel project gets environment clearance

02 August 2007

Posco has proposed to build a $12 billion steel complex in mineral-rich Orissa, but the firm is facing problems over land and mining rights.

State-run Kudremukh Iron Ore Co. has staked a claim to the mines which Posco wants, although government officials say they are trying to resolve the issue. The firm, however, is yet to finalise an iron ore mining lease.

Posco''s proposed $12 billion steel project in Orissa, which could be India''s largest foreign direct investment, ran into trouble after local people protested against compulsorily acquisition of their land for the plant, which they say could displace up to 20,000 people.

Clashes between supporters and opponents have left scores injured, while villagers detained overnight two Indian executives of Posco in May.

The ministry of environment and forest cleared the project on July 19, following which it published a notification in a vernacular paper in Orissa, inviting comments and objection.

The 10-day period ended on 30 July and the company received no objections to the project. "As a result, Posco India is free to start work on the first phase of the project that involves a 4-million-tonne plant and 400mw captive power plant," a Posco spokesperson said.