Bhubaneswar, July 6 (IANS): Ferrochrome producers on Monday urged the Odisha government to extend chrome ore mining leases where the mineral is used for other than captive purposes as per the amended Mines and Mineral (Development and Regulation) Act.

The producers under the banner of the Indian Chambers of Commerce (ICC) said the government should extend the mining leases up to March 31, 2020, to increase production that would meet the needs of ferrochrome plants in the state.

Vishal Agrawal, chairman of ICC's Odisha chapter - who met state Steel and Mines Minister Prafulla Mallick and chief secretary G.C. Pati - said a drop in production had led to acute shortage of chrome ore in Odisha.

"The Odisha Mining Corporation (OMC) needs to increase production from existing operating and non-operating chrome ore mines and also increase production of chrome concentrates," said a memorandum submitted to the government.

It said the state government should ensure long-term agreements for meeting the ore demand from the OMC's south Kaliapani mines and other private lessees to Odisha-based ferrochrome plants at viable prices.

The memorandum said the transport cost from Sukinda chrome ore mining belt to the plants was abnormally high and urged the government to reduce the cost by breaking a strong nexus between influential locals and transport associations.

According to sources, Tata Steel, Mishrilal Mines and B.C. Mohanty have been major suppliers of chrome ore and concentrate to Odisha-based ferrochrome plants.

Last month, the industry lobby also wrote to Odisha Chief Minister Navin Patnaik for redress of their problems in this regard.

The state government is losing Rs.735 crore per annum royalty due to closure of some chrome mines, said sources.