The government has threatened to cancel coal block allocations to three companies, including Jindal Steel and Power (JSPL), for their failure to develop blocks allotted to them years back despite repeated reminders.
The other two companies are Chhattisgarh-based Madanpur North Coal Company and Chhattisgarh Captive Coal Company. The coal ministry has issued showcause notices to these companies.
JSPL, the Rs 55,000-crore O P Jindal Group company, has received flak for delays in developing the Utkal B-1 coal block in Orissa, allocated to it in 2003 for supply of coal to its proposed two-million tonnes per annum (mtpa) sponge iron plant, 80,000-tonnes capacity ferro alloys plant and 100-megawatts (Mw) captive power plant at Keonjhar in Orissa. JSPL’s 100-Mw captive power plant at Angul was also to get coal from this block.
The ministry has asked JSPL to explain the reasons for the delay in developing the block within one month. “Why the delay should not be held as violation of the terms and conditions of the allotment of the block, failing which it would be presumed that your company has no explanation to offer and action would be taken against your company for de-allocation of the said coal block,” the ministry said in the notice.
In a review meeting held in July, the ministry noted that critical milestones such as forest clearance and land acquisition were pending even seven years after the date of allocation. “It is seen that the company has repeatedly failed to keep its promises made to this ministry and thus, non-serious about timely development of the block,” the notice said.
The government earlier this month sent similar notices to three other O P Jindal Group firms — JSW Steel, Jindal Thermal Power Company and Jindal Stainless Steel — for delays in developing Utkal-A and Gopal Prasad West blocks in Orissa.
Chhattisgarh Captive Coal Company, a joint venture led by Ispat Godavari for supply of coal for sponge iron and captive power generation plants, got the notice for delays in development of Nokia-I and Nokia-II blocks. Madanpur North Coal Company got it for delays in commencing production from Madanpur North coal block.
The coal ministry has prepared a list of 93 captive coal blocks, where development has not been satisfactory, and is in the process of threatening the block holders of de-allocation. Since September 22, the ministry has so far issued similar notices to at least 30 such companies.
