SC notice to Rajasthan power firm on PIL seeking coal block de-allocation

A PIL in SC sought cancellation of Parsa East-Kante Basin coal blocks allocated to ParsaKente Collieries, where Adani Enterprises is MDO

The Supreme Court on Tuesday issued notice to Parsa Kente Collieries (PKCL), a subsidiary of Rajasthan Rajya Vidyut Utpadan Nigam (RRVUNL), and sought PKCL’s reply to a petition seeking cancellation of the Parsa, Kente extension coal block allocated to it. Infrastructure giant Adani Enterprises is the mine developer-cum-operator (MDO) for PKCL.

The petition, moved by non-profit organisation Common Cause, alleged that Adani Enterprises and RRVUNL were in a joint venture (JV), which was in contravention of a 2014 order of the top court.

In 2014, the Supreme Court had cancelled 214 of the 218 coal blocks allocated to various companies since 1993. It had then said that no state government or public sector undertaking of state governments were eligible to mine coal for commercial use. The top court had further said that any JV arrangement with firms or formation of a consortium or association for coal block allocation was also not permissible.

In its petition, apart from seeking cancellation of the Parsa, Kente extension coal block allocated to PKCL, Common Cause also sought that RRVUNL cancel its JV and coal mining delivery arrangement with Adani Enterprises. Adani holds 74 per cent in the JV, while RRVUNL holds 26 per cent, the petition alleged.

Infrastructure major Adani Enterprises had in 2013 started commercial coal operations from the Parsa, Kente extension mine in Chhattisgarh. The mine, owned by RRVUNL, holds reserves of over 450 million tonnes (mt) of coal.

Earlier, Adani Enterprises had in 2007 won RRVUNL’s bid to become the MDO of the mine, wherein the former would take the all responsibility of land acquisition, mining, developing, and mine operations, including resettlement and rehabilitation.

The MDO also brings the necessary investment for the set up. According to the agreement between Adani Enterprises and RRVUNL, the coal mine had started production from 2 mt of coal per year in 2013 and ramped up production to 15 mt of coal by 2017. Adani Enterprises had planned a capital outlay of Rs 30 billion for the said coal block.