Coal news and updates

Govt invokes BG of UCM Coal

The Centre has decided to invoke bank guarantee partially on UCM Coal Company Limited, a joint venture of Uttar Pradesh Rajya Vidyut Utpadan Nigam Limited (UPRVUNL), Chhattisgarh Mineral Development Corporation (CMDC) and Maharashtra Power Generation Company (MAHAGENCO), for delay in development of two Chhendipada coal blocks.

“Bank guarantee to the extent of ` 16.65 crore will be invoked and deposited in Government account,” the inter-ministerial group (IMG) recommended after reviewing progress of the two coal blocks.

While recommending proportionate deduction of bank guarantee for non-achievement of targets as per the allotment order, the IMG did not favour de-allocation of the coal blocks at this stage.

The IMG took into account factors like delay in grant of statutory clearances by the State Government and the objection raised by the State against allocation of coal blocks in Talcher coalfields to 11 public sector units (PSUs) including the three PSUs.

Though the Chhendipada and Chhendipada-II coal blocks were allocated to three PSUs of Uttar Pradesh, Chhatisgarh and Maharashtra in 2007, the joint venture company failed to achieve the targets.

Although the mining plan of the company was approved after a gap of four years, the environmental and forest clearances have been reportedly held up by the State Government objecting to the allocation of coal blocks of other State PSUs.

The joint venture company argued before the IMG that the reasons of the delay should not be entirely attributed to it and assured to operationalise the coal block by February 2015 provided the objection raised by the State Government is resolved.

The Uttar Pradesh company has proposed to set up a 3000-MW thermal power plant while CMDC and MAHAGENCO have planned to set up 2900-MW and 2500-MW power plant respectively.

“The recommendation of the IMG is without prejudice to any action arising out of issue pertaining to allocation of coal block, formation of joint venture, engagement of mine developer and operator (MDO) which may separately be under consideration of the Central Government,” the IMG report stated.

The Centre has accepted the recommendation of the IMG, informed the Ministry of Coal.

Source: The New Indian Express