METAL and power companies including Hindalco, Nalco, Jindal Steel & Power (JSPL), JSW Stainless and Hindustan Zinc face the prospect of losing their allotment of captive coal mines. Ministry of coal is planning to issue showcause notices to all companies that have failed to meet the milestones finalised for the development of captive coal mines. The move is aimed ensuring timely production from captive mines that is expected to generate over 20% of total produced in the country by 2011-12.
“It has been observed that companies take coal blocks and sit on it for months before staring work on it. This would not be tolerable. If milestones are not met, we may go ahead and even cancel their allocation,” a senior official in the coal ministry said.
Already a meeting has been organised between coal allocatee companies and senior officials of the coal ministry to assess the situation. The ministry, however, is also considering to issue show cause notices to companies that have consistently failed to meet the milestones.
The coal ministry is expecting production from captive coal blocks to go up from present 25 million tonne (mt) to over 100 mt by 2011-12. This would require that all of the 165 captive coal blocks allocated so far are brought under production. So far only about 20 of these blocks are under production. The prime minister’s office (PMO) has also asked the ministry to take strict action against delays.
“Companies give us excuse that sluggish progress on captive mines is due to delays in getting clearances from the state government. This is not acceptable and the allocatee’s should take the responsibility of bringing the blocks under production on time,” said the official.
As per rules for captive mining, an opencast mine and underground mine has to be brought under production within 36 to 54 months. Different milestone has also been set for getting geological report (GR) and forest clearance (FC).