Coal ministry deallocates 14 coal blocks

The coal ministry today said it had decided to cancel the allotment of 14 coal blocks and one lignite block to six PSUs, including NTPC, and three private firms for failing to develop the mines.

"Ministry of Coal has decided to deallocate 14 coal blocks and one lignite captive coal block for slow implementation/non-implementation of mining projects," an official statement said.

The decision follows the recommendations of a coal ministry panel, which reviewed progress made by steel, power, cement and other firms in the development of 88 coal and lignite blocks allotted for captive use by the companies.

The committee has also recommended that bank guarantees of 15 private firms be invoked as they had failed to achieve
commencement of production as per allotment norms. It recommended that 29 block allottees be issued warning for bringing their blocks into production at the earliest, according to the statement.

Apart from NTPC, the ministry has decided to cancel the licences for blocks awarded to Damodar Valley Corporation, Andhra Pradesh Power Generation Corporation, Tenughat Vidyut Nigam Ltd and the Electricity Boards of Bihar and Jharkhand, as these companies had failed to adhere to norms, according to a senior official.

The private firms which have been served deallocation notices include VS Lignite and Baidyanath Ayurved Bhawan. Earlier, the coal ministry had issued show-cause notices to 81 companies in the steel, power and cement sectors as they had failed to develop the coal blocks within the agreed timeframe.

The firms had cited a host of reasons, including problems of land acquisition, for their inability to develop the blocks.
According to coal minister Sriprakash Jaiswal, the government was serious over the issue as it was concerned about the precious resources lying idle. In a bid to weed out players that were not serious, the government had last year, while issuing notices to the firms, sought their responses as to why coal blocks allocated to them should not be withdrawn, as they had failed to develop them within the agreed timeframe.

Among the companies that have been issued show-cause notices are Jindal Steel and Power Ltd, JSW Steel and GMR Energy