Mine coal or get licences cancelled: Min warns 5 cos

The Coal Ministry has asked five firms, including Jindal Steel and Power (JSPL) and GVK Power, sitting idle on the coal blocks allocated to them for captive use to either begin production or it would cancel their licences.

"The allocatee is hereby warned and directed to develop the block without any delay. Any further failure in the development of the block would lead to necessary action... including de-allocation of the coal block," according to the warning letter sent by the ministry to the five firms.

JSPL was warned for delaying the development of Utkal-B-1 block, which the coal ministry had allocated to it in 2003 for supply of coal to the proposed two million tonnes per annum (MTPA) sponge iron plant, 8,000 tonne capacity ferro alloys plants in Orissa, and proposed power plants in Orissa.

GVK Power (Govindwal Sahib) was issued letter for significant delay in developing Tokisud North coal block.

The other companies which were issued warning letters are Damodar Valley Corporation for Khagra Joydev coal block, Jharkhand State Mineral Development Corporation for Latehar coal block and Bihar Sponge Iron for Macherkunda coal block.

Besides, a couple of days back, the government had issued warning to seven firms, including Arcelor Mittal, to begin the development of coal and lignite blocks allocated to them without further delay, failing which their coal blocks would be cancelled.

Steel maker Arcelor Mittal India and GVK Power (Govindwal Sahib) were warned for inordinate delay in developing Seregarha coal block, jointly allocated to them to meet the coal requirements for their captive power plants.

Bhushan Power & Steel was warned for delay in developing Jamkhani coal block, allocated to it in 2003 to meet the coal requirement of its sponge iron and captive power plants.

In addition, DCM Shriram Consolidated was warned for delaying the development of Kaparion-Ki-Dhani lignite block and VS Lignite Power for Lunsara lignite block.

Other firms which were warned include Mideast Integrated Steels Ltd and West Bengal Power Development Corporation.

In May, the Coal Ministry had said a panel set up by it to look into the process of deallocation of coal blocks had recommended issuing warnings to 29 coal and three lignite blocks allocatees.

It also sugested cancellation of 14 coal blocks and one lignite block awarded to six PSUs, including NTPC and three private firms for failing to develop mines on time. Government cancelled coal blocks for various firms NTPC, Damodar Valley Corp and Andhra Pradesh Power Generation Corporation.