Orissa government on Thursday decided to go ahead with the proposed Rs 52,000 crore Posco project but exclude 300 acre of private land at Dhinkia village in the face of opposition to its acquisition.

"The state government will advise Posco not to take private land belonging to people of Dhinkia village," chief minister Naveen Patnaik told reporters after a meeting of MLAs and the lone MP Bibhu Prasad Tarai of CPI from Jagatsinghpur district.

The Posco project would now come up on 3567 acre against the original plan of setting up the steel plant by the South Korean company on 4004 acre, agriculture minister Damodar Rout, who represents Paradip assembly segment in Jagatsinghpur district, said.

Tarai said the chief minister had also agreed to hold talks with the people to be affected by the project.

Of the total 4,004 acre required for the proposed 12 mtpa mega steel plant, the state government had 3566 acre while private persons held about 437 acre.

Though the South Korean steel major had signed an MoU with Orissa government in June, 2005, for the project, not an inch could be acquired so far due to stiff resistance from the local people.

Stating that Posco did not believe in forcible acquisition, a senior company executive, reacting to the decision, said "we will certainly try to accommodate everything within the land available to us."

CPI-backed Posco Pratirodh Sangram Samiti (PPSS) has been opposing land acquisition at the project site.

Meanwhile, Patnaik appealed to the MLAs and the MP for support to implement the project which would have a turnover of Rs 12,000 crore per annum producing 12 mtpa of steel with the state government expected to get an annual revenue above Rs 2000 crore.

The project has obtained environmental clearance from the union ministry of forests and environment, revenue divisional commissioner of the central division, P K Mohapatra said.

Earlier, security forces were redeployed at Balitutha, the entry point to the project site. About 25 platoons of securitymen comprising around 750 personnel were deployed at Balitutha.

A fresh survey was likely to be conducted in two of the three gram panchayats identified for the project, official sources said.

Though the administration had in 2008 conducted a socio-economic survey in the three gram panchayats, including Dhinkia, the epicentre of the anti-Posco agitation, it was decided to re-do it.

"The next survey is to verify the previous one which was conducted hurriedly," the sources said.

According to 2008 survey, it was estimated that 803 families, including 131 families from Dhinkia, would be displaced to set up the steel plant.

Meanwhile, Posco Pratirodh Sangram Samiti President Abhay Sahu told reporters that "we will not allow the company to acquire the government land at Dhinkia village."

Though the government's new formula suggested that about 300 acre of private land would not be acquired to set up the Posco project, there was no restriction in acquiring government land.

"We will not vacate the government land in possession of the villagers," Sahu said addubg people had grown betel vines over 100 acre of government land for generations.

As betel leaf production was the chief source of livelihood for the villagers, they would not vacate the land even though it belonged to the state government, Sahu said.