Coal news and updates

Govt cancels coal blocks of 18 companies

Eight of these blocks are part of the 61 captive coal acreages allocated to private companies post 2005


Acting on the recommendations of a high-level inter-ministerial panel, the coal ministry on Monday cancelled 10 coal blocks allocated to 18 companies including Adani Power, Jindal Steel and Power (JSPL), Rungta Mines and a joint venture between Tata and South African Sasol.

Eight of these blocks are part of the 61 captive acreages allocated to private companies after 2005, where the Supreme Court had last month asked for a status report of development as part of an ongoing hearing in the Rs 1.86 lakh crore coal allocation scam. The blocks were reviewed on February 7 and 8 by an Inter-Ministerial Group (IMG).

“The recommendations of the IMG have been considered and accepted by the competent authority. The coal block allocated to your company is de-allocated forthwith. Your company shall not be eligible for allocation of coal blocks in lieu of the de-allocated block,” the ministry said in similar cancellation letters issued to the companies.

The apex court had asked the Centre to explain the delays in the development of blocks. The Centre later conceded before the court that “in hindsight, we can say something has gone wrong, and some correction is required to be done.” The review exercise by the IMG, headed by the coal ministry’s Additional Secretary A K Dubey, followed.

The blocks cancelled today include two Coal-to-Liquid (CTL) blocks – Ramchandi promotional allocated to JSPL and North of Arkhapal-Srirampur held by a Strategic Energy Technology Systems (SETSPL), a joint venture between a consortium of Tata Group companies and South African energy major Sasol.   

Ramchandi Promotional block has estimated reserves of 1,500 million tonne. It was allocated to Member of Parliament Naveen Jindal-promoted JSPL in 2009 and was meant to feed the company’s Rs 77,450 crore CTL project in Odisha. JSPL had earlier requested the petroleum ministry to forward the project proposal to the Cabinet Committee on Investment (CCI). SETSPL had also sought centre's intervention for taking up its Rs 66,000 crore CTL venture with the CCI.

The ministry had on January 15 served a three-week ultimatum to the companies sitting on the 61 blocks where mining leases have not been executed to furnish the proof of the requisite clearances obtained by them to operationalize their captive mines.

Source: Business Standard