Government to de-allocate four coal blocks

New Delhi: The process to de-allocate coal blocks has begun. Acting on the recommendations of the Inter Ministerial Group (IMG) on the coal blocks allocation controversy, the Centre has decided to de-allocate four coal blocks.

The decision by the government came after the IMG recommended de-allocation since the companies had not operationalised the mines.

Following the decision by the government, Castron Mining Ltd, Field Mining and Ispat Ltd and Domco Smokeless Fuels Pvt Ltd will be de-allocated.

While Castron Mining Ltd and Domco Smokeless Fuels Pvt Ltd have one block each, Field Mining and Ispat Ltd owns two blocks.

Further acting on the recommendations of the IMG, the Centre has also decided to deduct the bank guarantees of three companies.

The recommendations of the IMG cover as many as eight coal blocks.

Talking about the decision by the government, Coal Minister Sriprakash Jaiswal said, "Expect final report of 58 coal blocks in four to five days. On the basis of the performance of coal blocks, the IMG has given the recommendation...we have accepted the recommendations of the IMG on coal blocks."

Earlier, he had said, "IMG is only reviewing the performance of these companies. The ministry had allocated coal blocks so that the country could get maximum power but some companies couldn't perform up to the mark. Today the names of eight companies had come up. Some more names might come out tomorrow."

The IMG met for three days from September 6-8 and then sent its recommendations to the Coal Ministry.

According to sources the Power Ministry forced the IMG to dilute action on bank guarantees. The minutes of the three-day IMG meeting reveals Power MInistry's hand. While the initial wording was "Recommend Imposition Of Bank Guarantee", the Power Ministry got it changed "May Consider". The IMG confirmed the minutes only after the above change was made.

Reason's for recommending de-allocation:

Castron Mining Ltd - Block: Bramdih allocated in 1999. No end use plant so So de-allocation recommended

M/s Field Mining and Ispat Ltd - Two blocks in Chinora and Varora in Maharashtra allocated in 2003. No end use plant.

Domco Smokeless Fuels Pvt Ltd - Block: Lalgarh North allocated in 2005. No end use plant and no mining plan.