Paradip additional district magistrate Sarojkant Choudhury said with the local residents agreeing to allow resumption of work, the administration began felling of trees and other civil works.
He said in a change of strategy, the district administration has now decided to negotiate with individual groups who guard the forests to facilitate work.
There are altogether seven groups - five at Nuagaon and two in Gadakujang panchayats guarding nearby forests. At least five of the seven groups are known to have allegiance to pro-Posco United Action Committee (UAC).
The administration held successful discussion with one of the seven groups guarding the forest - Dadhibaman group at Nuagaon panchayat area on Friday.
The group had put forth two demands for resumption of work - payment of compensation at existing rate to new and old betel vines in 2008.
The administration agreed to both the demands, the sources said. Work at the proposed site was stalled following a scuffle between people and police at Mathasahi in Nuagaon panchayat on July 16 in which five women were injured.