Coal news and updates

Usha Martin to tap alternative coal sources post de-allocation

September 26: Usha Martin Limited will meet its requirement of coal from alternative sources post de-allocation of two of its captive mines, the company said in a filing to the BSE on September 25.

The process “will impact its cost of production and profitability,” a company statement added.

According to the statement, the company's operating coal mine at Kathautia, Daltonganj in Jharkhand, allotted in 2003, with initial estimated deposit of 30 million tons (mt) and annual production of 800,000 tons stands cancelled.

“As per this order, the company will have to wind up its operations and hand over the mine to the government by March, 2015. Also, the company will be required to pay to the government at Rs 295 per ton on its coal production, including about 2 mt up to March 2014. The other coal block allocated to the company (Lohari) would also be cancelled as per the Supreme Court order.

The coal block is yet to be made operational.

“The extent of such an impact would be worked out in due course. The company would wait to develop clarity about the process of handover and investments it has made to make the coal mine operative. To the extent of non/under recovery, such investments may have to be written off,” the company statement added.