Coalgate: Gujarat Ambuja Cement, Grasim Industries coal blocks face cancellation

NEW DELHI: An inter-ministerial panel has recommended de-allocation of two coal blocks held by five companies, including Gujarat Ambuja Cement, Grasim Industries and Lafarge India, bringing the total number of such blocks to 13.

The Inter-ministerial Group (IMG) has completed the review of 29 coal blocks held by private companies and recommended cancellation of licences for blocks holding an estimated 2.6 billion tonnes of coal, affecting 28 private companies, including JSW Steel, SKS Ispat & Power, Bhushan Steel Electrosteel Castings and Grasim Industries.

"The IMG recommended cancellation of mining licences of Bhaskarapara block in Chhattisgarh and Dahegaon Makardhokra IV in Maharashtra," a member of the panel said on Thursday on condition of anonymity.

The Dahegaon Makardhokra IV coal block with 132 million tonnes reserves was allocated to IST Steel & Power Ltd, Gujarat Ambuja Cement and Lafarge India Pvt Ltd in 2009.

The Bhaskarapara block in Chhattisgarh with 48 million tonnes of reserves was allotted to Electrotherm (India) Ltd and Grasim Industries Ltd in 2008.

The scrapped coal blocks being taken back from the private companies will bring revenue to state governments since the blocks will be allocated for a cost in future. The coal ministry has, however, not yet decided on procedure of allocation of the 13 blocks with 2,609 million tonnes of reserves recommended for cancellation by the IMG.


A senior coal ministry official said the coal blocks would be auctioned to private firms or given to government companies at reserve price if the ministry does not want to allocate them to Coal India Ltd that has been allocated 116 blocks two months ago. The official said that the ministry has already identified 54 coal blocks for three types of allotments - to government companies, to power companies and to private firms through auction .

"If we decide that Coal India has enough blocks, we may give it to other companies through auction route. Whatever the route is, no block will be given free of cost and even Coal India will pay a reserve price," the official said.