Govt decides to deallocate one more mine

The government on Monday decided to deallocate one more mine - Gourangdih ABC-- jointly given to JSW Steel and Himachal Emerging Markets Trade Association besides deduction of bank guarantees of two allottees for failing to develop mines within time.

This follows the recommendation made by Inter-Ministerial group which is scrutinising 29 blocks awarded to the private parties out of the total 58 which were given show cause notices for delays in development and some of these find mention in the Comptroller and Auditor General report.

With this, the government has approved cancellation of licenses of five coal blocks, out of a total seven recommended by the IMG so far.

"I have approved the IMG's recommendations given on Friday and will take a call on others," Coal Minister Sriprakash Jaiswal told PTI ahead of the meeting of the panel, scheduled on Monday afternoon.

The IMG, on Friday had recommended deallocation of the Gourangdih ABC mine, given jointly to JSW Steel and Himachal EMTA, in 2009. The block has 61.54 million tonnes of extractable reserves and the coal from the mine was meant to be used for a  power project.

The block finds mention in the CAG report as well. The government auditor had said the allottees of the block, located in West Bengal, might have accrued undue benefit to the tune of Rs 1,818 crore.

Earlier, on September 13, the government had decided to de-allocate four blocks -- Bramhadih Block in Jharkhand allocated to Castron Mining Ltd in 1996, Chinora and Warora (southern part) blocks in Maharashtra given to Fieldmining and Ispat Ltd in 2003, Lalgarh (North) block in Jharkhand allotted to DOMCO Smokeless Fuels Pvt Ltd in 2005.

It had also accepted the IMG recommendations to deduct Bank Guarantee (BG) in case of Marki Mangli-II, III and IV Blocks in Maharashtra allocated to private player Shri Virangana Steels besides asking Monnet Ispat & Energy to submit BG for Utkal B2 Block in Odisha allocated it.

The CAG had recently estimated that the financial impact of the benefit to the private allottees will be about Rs 1.86 lakh crore. Meanwhile, the panel is meeting again later in the day to decide the fate of about six more coal mines allocated to private firms that were issued notices for delaying production.

The panel on Saturday had recommended deallocation of mines including one to SKS Ispat and Power in which Tourism Minister Subodh Kant Sahai's brother allegedly had a link and another jointly allotted to Jindal Steel Works. However, the coal ministry is yet to take a call on these.

The panel has so far scrutinised the replies furnished by 18 coal block allottees out of 29, in its three meetings last week.