KOLKATA (Commodity Online): In a bid to finish its steel plant work fast, South Korean steel major Posco has decided to separate mining and the steel project to be set up in Paradeep in Orissa.

The company is proposed to build a 12 million tonne integrated steel plant in Orissa. Posco is expected to start ground leveling work for the project next year. It, however, ruled out the possibility of leaving out Dhinkia, the epicenter of anti-Posco agitation in the project area, from the original site plan.

It was speculated that the company may drop this village from the site map to circumvent opposition to its project in the area.

By the end of 2009 all the legal matters will be solved and early next year, the construction work like leveling of land will start, the company said.

Since the grant of prospecting license (PL) and subsequently mining lease (ML) will be delayed due to the litigations involved in the matter, the company sought raw material linkage for the project.

In this context, the government agreed to provide raw material linkage through Orissa Mining Corporation (OMC), as it has been providing to some MoU signed companies, to Posco as an interim measure.

Since the memorandum of understanding (MoU) states that the raw material linkage can be provided when the lease is under litigation, there will not be any problem in providing them raw material linkage.

The Rs 51,000 crore project, billed as the largest foreign direct investment proposal of the country, could not make substantial headway due to the resistance of the local people to the land acquisition.