Demanding resignation of Orissa chief minister Naveen Patnaik following a stay order by the union environment ministry on clearance for Vedanta university, the BJP today said the entire project area near Puri should be declared ecologically sensitive.

"The chief minister's office has come under cloud with the environment putting on hold clearance of Vedanta University project," senior BJP leader and Rajya Sabha member Rudra Narayan Pani told reporters here.

"Therefore, Naveen Patnaik has lost all moral rights to continue in office and he must resign forthwith for alleged irregularities in allotment of over 6,000 acres of land along the sea near Puri for the proposed university project," he said.

Vowing to intensify their stir against the project, Pani and another senior party leader Uma Ballabh Rath alleged that the BJD government handed over precious land at a throw-away price fraudulently in connivance with the Congress.

In view of the presence of a sanctuary in the area and its environmental significance, the entire project area should be immediately declared ecologically sensitive, Rath said claiming that the residents of Puri and nearby areas would not get a drop of water if the university is set up there.

The existing eco-system must be maintained in the area to ensure ground water recharging, he said adding all water sources in the area would dry up if the university is set up as it would lift huge volumes of water.

Unfazed by the union environment ministry putting hold on clerance of its university project in Orissa, Vedanta Group has said it would overcome the hurdle by submitting requisite documents with the authority.

"The ministry has put on hold the environment clerance accorded to our university project and not cancelled it.

Therefore we will comply with all requirements of the ministry in order to get the clerance," a senior Vedanta Group official said.

The ministry, which on April 16 accorded conditional environment clearance to the varsity project near Puri, issued the fresh direction on May 11 in view of some alleged irregularities by its promoter Anil Agarwal Foundation.