After seven years of delay, the Posco steel project will start moving ahead soon as Odisha has started transferring around 1,500 acres to the Korean steel major to set up an eight-million tonne plant in the first phase, Odisha Steel and Mines Minister, Mr Raghunath Mohanty, said on Wednesday.

However, the Minister did not specify a timeframe under which the land transfer will be completed.

The State will also soon sign a tripartite agreement with Posco India and its parent to revive the Memorandum of Understanding (MoU) which had lapsed since June 2010, the Minister said.

“Transfer of around 1,500 acres is underway and we hope the tripartite agreement with the steel company will be signed soon,” he said over phone from Bhubaneswar.

Earlier, after consultations with the Government, Posco had decided to reduce its land requirement to 2,700 acres from over 4,000 acres.

The State has already transferred 500 acres to the company for setting up the proposed plant, which has an original capacity target of 12 m.t, involving an investment of Rs 52,000 crore, making it the single largest foreing direct investment in the country.

In view of land scarcity, Posco has decided to build an eight-m.t plant in the first phase and scale it up to 12 m.t later.

Conditions approved

Mr Mohanty said Posco had also agreed to three major conditions which include employing a certain percentage of local people in the proposed plant, setting up downstream industries near the project and swapping of iron ore within the country.

“The steel firm has agreed to swap the iron ore within the State or within the country,” the Minister said.

Posco had earlier asked for swapping high alumina content iron ore found in Odisha’s Khandadhar mines, which is amid a legal row, with better quality ore from abroad.

Mr Mohanty also said the boundary wall work has already started in the project site and full-fledged work will start soon.

The Rs 52,000-crore Posco project has been stuck for the past seven years, on the back of local opposition to land acquisition coupled with pending environment approvals.

However, the Minster said “I think, after slashing of land requirement and iron ore swapping issue, local opposition to the project is fading.”

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