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The Coal Ministry has asked Power Ministry to probe "violation" of captive coal block allocation norms by Jindal Steel and Power Limited (JSPL) through selling surplus power generated by leftover coal from its mine in Chhattisgarh to others.
"... The washed coal is used in the manufacture of DRI (Direct-reduced iron) and the leftover coal in the form of middlings are used in generation of power in its (JSPL) captive power plant and surplus power is sold to others, which is violation of captive clause," the Coal Ministry has said.
The Coal Ministry, in a letter to Power Ministry, requested it to "examine the matter in detail and furnish the comments".
JSPL was allocated Gare Palma IV/I coal block in Hasdeo Arand coalfields at Raigarh in Chhattisgarh in 1996 for captive mining of coal to meet the requirement of its sponge iron plant. The mine has a geological reserves of 124 million tonnes(MT).
When contacted, a JSPL spokesperson said, "Surplus power has been sold as policy of Government of India and State Government."
Stating that the company has not received any notice from the Coal Ministry in this regard, the spokesperson said, "However it may be mentioned that we are operating Captive Power Plant at Raigarh based on Coal middlings / rejects of our coal washery and hot gases generated during process of manufacture of sponge iron and hot metal. Washed coal from the Coal washery is used for making Sponge Iron."
The company had in January written to the Coal Ministry stating the washed coal from the block is used in the generation of DRI and thereafter leftover coal, called middlings, are used for power generation.
Demand for power is fluctuating as the company is using electric arc furnace for steel making, it said, adding, "As consumption of power varies, the quantum of available surplus power also changes frequently."
"We are selling power surplus to our requirement which is fluctuating mainly to Chhattisgarh State Power Distribution Co Ltd," JSPL said.
