Coal news and updates

Ex-owners of cancelled blocks put up tough fight in e-auction

JSPL bids aggressively; Reliance, Adani, Sesa Sterlite, GMR, GVK, Essar in race...


Former owners of the cancelled coal mines have bid aggressively for re-allocation of these blocks. Companies such as Jindal Steel & Power (JSPL), Hindalco and CESC are vying for the blocks they lost following a Supreme Court's judgment. Twenty-three operational coal blocks have been put on the block in the first phase of auction. Out of this, six with end-use in power generation saw 54 bids. The remaining blocks, which were kept for unregulated sectors - iron & steel, cement, and captive power production - received a whopping 124 bids.

In the fray are major names from the power, steel and cement sectors. Adani Power, Sesa Sterlite, Essar Power, GMR, GVK, Lanco, Rattan India and JSW Energy are the major players bidding for coal blocks with end-use in power production. (COAL RUSH)

For the coal blocks kept for unregulated sectors, there was immense interest from steel companies such as Birla Corporation, Hindalco, Bharat Aluminium, Hindustan Zinc, Sarda Energy and BS Ispat. Bidders from the cement sector are ACC, UltraTech Cement, Shree Cement, Reliance Cement and Jaypee Cement with participation in every block kept for unregulated sectors.

In all the blocks that it lost, Naveen Jindal-promoted JSPL has submitted more than one bid. For its most attractive and also controversial blocks - Gare Palma IV-1 & 7 - JSPL has submitted four bids. Jindal is one of the accused in the coal scam. Birla group's Hindalco, which is also embroiled in the coal scam, has also bid for the coal blocks with end-use in steel and cement sectors.

Among the new entrants is Anil Ambani-promoted Reliance Geothermal, which has bid for Amelia (North) situated in Madhya Pradesh and Gare Palma 2&3 in Chhattisgarh. These blocks have minable capacity of 100 million tonnes with end-use in power generation.

The comparatively minor companies, which are also part of the race, are Topworth Group, Sanvijay Rolling & Engineering, Sunflag Iron & Steel and OCL India.

The names of bidders who submitted technical bids for the upcoming e-auction were disclosed on Tuesday. These bids will be evaluated by a multi-disciplinary 'technical evaluation committee', which will shortlist the bidders for participation in the electronic auction to be conducted on the MSTC portal from February 14, 2015.

The government plans to have a two-pronged strategy for e-auction of cancelled coal blocks. Where end-use is generation of power, there will be reverse auction. For unregulated sectors, there will be forward-bidding model.

The government promulgated a special ordinance for re-allocating coal blocks, which were cancelled by the Supreme Court in August this year, citing them illegal.


Source: Business Standard