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Centre, Odisha to forge SPV for coal evacuation

In the SPV, the Odisha government will have 10% equity

BS Reporter  |  Bhubaneswar 

The state government will tie up with the Ministry of Coal and the Railways ministry to float a special purpose vehicle (SPV) for evacuation of coal.

"This will be the first of its kind SPV in the country. Our government will sign a memorandum of understanding (MoU) with the Coal and Railways ministries on April 20 for the SPV. The SPV is being forged to evacuate coal. Under this SPV, project specific SPVs can be formed where private partners can have equity participation," said Sanjay Rastogi, secretary (commerce & transport), Odisha.

In the SPV, the Odisha government will have 10 per cent equity. The Ministry of Coal or its PSU, Mahanadi Coalfields Ltd (MCL), a Coal India subsidiary, will have 64 per cent equity while the Railways ministry through any of its PSUs- Rail Vikas Nigam Ltd (RVNL) or IRCON will hold 26 per cent share. In February this year, Coal secretary Anil Swaroop had announced two SPVs to facilitate speedy evacuation of coal from Talcher and Ib valley coalfields in Odisha. Coal stockpiled at pitheads has been a pressing issue for both the Centre and the state government. Hence, the SPVs are planned to evacuate coal.

Coal evacuation has assumed significance as Coal India and its subsidiaries plan to increase production.

Coal India envisages to ramp up production to one billion tonne by 2020 from 500 million tonne presently.

Similarly, coal production from MCL, a CIL subsidiary, is also set to be expanded from 125 million tonne a year to 250 million tonne by 2020.

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First Published: Fri, April 17 2015. 20:17 IST