The Jharkhand government has given its consent to global steel giant ArcelorMittal to explore manganese and iron ore in the state.

In its report to the Union ministry of mines, the state mining department has given its consent to award an exploration licence to the steel major in West Singhbhhum district.

Director of industries B P Singh said the state government has sent its report on the query of the Union mines ministry, seeking its views on the proposal of the steel company. "We expect the Union mines ministry to take a final decision on the matter soon," he said.

The steelmaker had submitted an application for approval through the state mining department to the Union ministry of mines for exploration in the Karampada region of West Singhbhum district. It was submitted on December 30, 2009.

The company had sought permission for two blocks of 662 hectare and 416 hectare to explore manganese and iron ore in the Karampada region. While 662 hectare is gazetted area, the 416 hectare area is non-gazetted.

Sources in the mining department expressed hope that the presence of companies like ArcelorMittal will boost the morale of prospective investors. It will also help the company move ahead with its proposed Greenfield project that has been pending since 2005.

The company had also signed a memorandum of understanding with the state government in 2005 to set up a 12 million tonne per annum plant with an investment of around Rs 40,000 crore.