Give coal to end-use plants linked to cancelled mines: Panel

According to an official document, running plants will be given preference

An inter-ministerial panel on fuel linkages has recommended providing coal to end-use plants linked to the blocks that have been cancelled by the Supreme Court.

The Standing Linkage Committee (Long Term) recommended that "in view of the scarcity situation of coal, prioritisation of categories of coal supply be done...In case of the deallocated/cancelled coal blocks," according to an official document.

The first category is of those end use plants (EUPs) which already had long-term linkages/LoAs (Letter of Assurances) but were later converted to tapering-linkage.

The second category is of those EUPs which were granted tapering linkages.

Tapering linkages are interim supply arrangement made for power projects where production from linked captive coal blocks is delayed.

"The Committee recommended that coal be suppled to the EUPs (under both the categories) subject to availability (of coal)," it said.

"For the purpose of supply of coal...CIL (Coal India) shall assess the quantity of coal that could be made available for this dispensation and keeping that in view, may enter into MoU with EUPs," it added.

The document said that tentatively, additional 5-7 million tonnes of coal may be made available under current arrangement and till March 31, 2015.

"Preference would be given to the running plants. Further, coal supply...Shall be confined to EUPs under sponge iron/steel and cement sectors only....The CPPs (Captive Power plants) shall be excluded from the above arrangement (because of scarcity of coal)," it said.

EUPs linked with the operational blocks should not be covered under the current arrangements as they are entitled to receive coal till March 31, 2015. EUPs to be supplied coal under current proposal will be offered coal from the mines nearest to them and they should lift coal by road, it added.

EUPs linked with those coal blocks which are under the investigation of CBI and FIRs have been registered against them shall not be considered for supply of coal.

In a major blow to the corporate sector, the Supreme Court had in September quashed allocation of 204 coal blocks alloted to various companies since 1993 terming it as "fatally flawed".