This was one of three options in the recommendations of the erstwhile Disinvestment Commission regarding MECL. The other options were regarding 100 per cent equity sale on as-is-where-is basis, and downright closure.

The department of mines and the core group of secretaries on disinvestment have also okayed downsizing at MECL and application of PL. Officials expect to realise better value of the company once the exploration is successful.

The cabinet committee on disinvestment (CCD) had given its in-principle clearance regarding disinvestment in MECL in the June 23 meeting. At the next CCD meet, expected to be held on Thursday, the department of disinvestment proposal is likely to be cleared. As per the annual estimates, MECL was expected to earn Rs 66.77 crore in the last fiscal. Up to December 1999, the income was Rs 41.11 crore. The estimated losses in 1999-2000 were Rs 5.32 crore, while the losses till December 1999 had accumulated to Rs 6.97 crore. Physical targets of MECL were scaled down in the last financial year.

Drilling was 221,000 metres in 1998-99, which came down to 210,000 m in 1999-2000. Actual performance till December 1999 was just 141,000 m. Mining till December 1999, at 4,560 m, exceeded the actual in 1998-99, which stood at 4,510 m. MECL was incorporated in 1972 with the specific mandate of detailed systematic exploration and establishment of reserves of various minerals and ores. The idea was to curtail the large time gap between the discovery of a prospect and its eventual exploitation.

It is the premier exploration company and undertakes exploration work on behalf of the government on promotional basis and for other agencies on contractual basis. The company is also diversifying into commercial mining of selected minerals and coal-sampling to increase its revenue.

In order to expand the activities of the company, vigorous marketing efforts have been made through competitive biddings. Discussions and negotiations for entering into MoUs and collaborative programmes with different clients within India and abroad are in progress. A total of 83 offers were submitted till December 1999. As part of its diversification, MECL intends to enter into commercial mining of minor minerals, deep drilling for exploration of coal-bed methane, and supply of ballast stone to Railways.