Telangana CM writes to PM, seeks four coal blocks out of central auction

The Telangana government and the Centre are at loggerheads over the upcoming coal block auction. Being the majority owner of Singareni Collieries Company (SCCL), Telangana wants the Centre to keep out four blocks coming in the entity’s area from the auction.

Against the auction move, around 41,000 employees representing trade unions had gone on a three-day strike from Thursday to Saturday. That led to a revenue loss of more than Rs 120 crore (production loss of around 140,000 tonnes per day) for the company.

A joint action committee -- including representatives of the All India Trade Union Congress (AITUC), Indian National Trade Union Congress (INTUC), Bharatiya Mazdoor Sangh (BMS), Centre for Indian Trade Unions (CITU), Hind Mazdoor Sabha (HMS), and Telangana Boggu Gani Karmika Sangham (TRS) -- is now looking to take a legal course on the issue, “with likely support from the state government”.

Telangana Chief Minister K Chandrasekhar Rao has written to Prime Minister Narendra Modi, asking him to direct the coal ministry to de-list the four blocks — Sathupally OC-III, Sravanpally OC, Koya Gudem OC—III, and Kalyanikhani block-6 UG — from tranche 13, for which electronic auctions have been scheduled for January.

“Allocation of four blocks is critical for maintaining coal supplies to the power sector and these are extension blocks on the dip side of the existing mining leases and adjacent to operating mines ...,” Rao said in his letter.

A senior official of the company said: “Around 41,000 employees went on strike, which led to a loss of over Rs 40 crore per day for the company. The management informed them that it is the Centre which is the decision-making body in this regard.”

Telangana holds 51 per cent in the company while the Centre has the rest.

“We are planning to meet the coal minister next week. If he does not accede to our demands, we will go to court. The state government is on a strong legal footing on the issue,” said INTUC leader Janak Prasad.

A senior government official did not respond to the Business Standard question on whether the state would be part of the case. A total of 88 coal mines -- 40 new mines and 48 unsold in the earlier rounds -- have been selected in the present round. These include the four blocks in Telangana.

Union Coal Secretary Anil Kumar Jain had last week said the government was getting a good response for the 13th tranche of auctions.

Rao’s letter, which Business Standard saw, said after the Mines and Minerals (Development and Regulation) Act of 2015, SCCL had approached the coal ministry for the allocation of the four blocks concerned.

However, despite repeated requests from the state, these blocks were included in the auctions. According to the MMDR Act, allocating coal-bearing areas is done through auction, reservation under Section 17(A) (2), or allocation under Section 11 (A) of MMDR Act, 1957. 

Rao asked Modi to intervene on the issue and direct the coal ministry to allocate the blocks to SCCL under Section 11 (A). Unions are also of the view that the rights to coal mining were given to SCCL by the Nizam’s government.

At present, SCCL produces 65 million tonnes of coal, meeting the requirements of thermal plants in Telangana, Andhra Pradesh, Maharashtra, Karnataka, and Tamil Nadu. After the bifurcation of Andhra Pradesh, peak power demand has increased from 5,661 Mw in June 2014 to 13,688 Mw in March 2021.