Odisha PSUs under CBI lens for coal blocks development

CBI is investigating if rules were followed in awarding mine development contracts

The state government is visibly worried over the ongoing investigation by the Central Bureau of Investigation (CBI) into five coal blocks allocated to three state run PSUs.

The CBI is probing into alleged irregularities into allocation of coal blocks that includes five blocks won by the state PSUs either exclusively or jointly with government owned firms of other states. These blocks are Utkal-D, Nuagaon Telisahi, Mandakini-B, Manoharpur & dip side of Manoharpur and Baitarani West.

In its preliminary enquiry, the CBI is investigating if the coal block allocatee followed the rules and procedure for awarding the mine development contracts and whether the system adopted by the concerned authorities in formation of joint ventures (JVs) was carried out in a transparent manner after conducting necessary due diligence.

“The CBI enquiry also covers the files relating to grant of mining leases which were to be granted by the Odisha government.  The Government of India has accordingly requested the state government to accord the necessary consent to enable the CBI to enquire into the irregularities”, G Srinivas, Odisha steel & mines secretary wrote to secretary  (energy) and chairman cum managing director of Odisha Mining Corporation (OMC).

The steel & mines department has sought information on three areas- if the allottee government companies have awarded contracts for development of coal mines, if the government firms have formed JVs with private companies and whether due procedure and rules have been followed in the process of awarding contracts and formation of JVs.

Both Utkal-D and Mandakini-B were allocated to state run miner OMC. The Nuagaon Telisahi coal block was allocated jointly to OMC and Andhra Pradesh Mineral Development Corporation Ltd. Another state owned firm Odisha Power Generation Corporation (OPGC) had won the Manoharpur and dip side Manoharpur coal block for pursuing its 1320 Mw expansion project. The Baitarani West block was allotted jointly to Odisha Hydro Power Corporation (OHPC) along with Gujarat Power Generation Corporation and Kerala State Electricity Board.

The Coal ministry had de-allocated New Patrapara, Baitarani West, Utkal-D, Mandakini-B and Naini blocks in view of their unsatisfactory performance.

Apart from blocks allocated to state PSUs, the CBI is probing into alleged profiteering by Nava Bharat Power that had sold its shares to Essar Power soon after being allocated the Rampia and Rampia dip side coal blocks for its 2250 Mw power plant proposed at Meramundali near Angul. Nava Bharat Power reportedly made a profit of Rs 200 crore from the deal.