Coal news and updates

Govt terminates coal mines of NTPC, WBPDCL and Monnet Ispat & Energy

The Coal Ministry has penalised a total of 45 firms and issued show cause notice to another 107 for delays in mine operations  | Photo Credit: --

The Coal ministry’s move comes in light of delays in mine operations and missed production targets by 45 coal mine allottees

The Coal Ministry has terminated mining leases of West Bengal Power Development Corporation (WBPDCL), Monnet Ispat & Energy and state-run NTPC for delays in operationalising coal blocks and missing production targets, the Parliament was informed on Monday

The Ministry penalised a total of 45 companies for delays in operationalising blocks and missing production targets, according to the data provided by Coal and Mines Minister, Pralhad Joshi, in a written response to a question in Rajya Sabha.

Besides these three companies, mine termination orders have also been slapped on GMR Chhattisgarh Energy, and OCL Iron and Steel with both orders being sub-judice.

The ministry has also deducted the bank guarantees (BGs) of companies such as Calcutta Electric Supply Corporation (CESC), Damodar Valley Corporation, Hindalco Industries, Essar Power MP, Tata Steel Long Products and Jaypee Cement Corporation. While orders for deducting BGs of Bharat Aluminium Company (BALCO), Adani Power, GMR Chhattisgarh Energy, Jaiprakash Associates, etc have been issued, the BG has not been deducted as the matter is sub-judice, the data showed.

Show ‘cause’

The Coal Ministry has also slapped show cause notices on 107 companies for not adhering to the timeline. The companies include NALCO, Vedanta, BALCO, Hindalco Industries, JSW Steel, UltraTech Cement, Birla Corp, Adani Power and Monnet Ispat & Energy.

The Ministry of Coal has issued an amnesty scheme in May 2022 granting a one-time window to allottee government companies to surrender non-operational coal mines without penalty, Joshi said. “Till date, Ministry is in receipt of requests for surrender of 11 coal blocks allotted to government companies of which three are Central PSUs and five are State PSUs after issuance of the policy,” he added.

The Minister, in a separate question, informed the upper house that, 64 coal blocks (52 under the Coal Mines (Special Provisions) Act and 12 blocks under the Mines & Minerals (Development & Regulation) Act) have been auctioned. The cumulative peak rated capacity (PRC) for all the 46 auctioned coal mines is 101.04 million tonnes per annum.

Besides, 106 coal blocks (35 under the CMSP Act and 71 under the MMDR Act) presently under auction processes are situated in areas that are granted protection under the Fifth Schedule of the Constitution, Joshi noted.

Commercial mining

Joshi said that, since the launch of commercial coal mining auction in June 2020, the auction process of 47 coal mines has been successfully conducted.

“Out of these 47 coal blocks, auction of one coal mine was cancelled since the preferred bidder did not comply with the conditions, and the vesting order has been issued for 27 coal mines,” he added.

In accordance with the efficiency parameters specified in the CMDPA which are to be adhered by the successful bidders, the time limit for obtaining the Mine Opening Permission is 66 months, in case of mines where Geological Report (GR) is to be prepared (Partially Explored Mines) and 51 months, in case of mines where GR is available (Fully Explored Mines), the Minister said.

He added that upon obtaining the Mine Opening Permission, the bidders will have to follow the production schedule as approved to achieve the PRC of the coal mine.