Coal India?s Rs 3,000-crore plan to wash 111 million tonne of coal by 2017 is heading towards an environment ministry roadblock on clearances.
Deepak Khaitan-controlled CMT, which in a consortium with the Emami Group, has bagged a Rs 300-crore order to set up a coal washery, is not very hopeful that it could set up the washery in time.
?We are supposed to set up the washery in the BCCL area. Even if we have bagged the order, the environment clearance and the required land is not with us,? Khaitan said.
PK Chandra, president and chief operating officer, McNally Bharat Engineering Company, said: ?Usually, a company floats a tender to find a qualified bidder after obtaining environment and all necessary clearances. But CIL has gone the other way round. It has first chosen the bidder before taking necessary clearances.?
Getting these clearances would take more than a year and by the time the project work is started, other factors like escalated costs could creep in, Chandra said.
?CIL plans to set up 20 washeries but I doubt whether any washery will be able to come up smoothly,? Khaitan admitted.
NC Jha, technical director, CIL, said there was no way other than taking the environmental clearance after selecting the bidder since the qualified bidder?s technology use would form the main basis for seeking environmental clearance.
?But we are also talking with the environment ministry to give us an in-principle clearance for all the washery projects and after we finalise the technology with the qualified bidder, the final clearance can be taken through a fast track route,? Jha said.
He said out of the 20 washeries, bidders for 11 washeries have already been short listed and three qualified bidders have been selected for implementing three washeries. Jha, however, did not name the qualified bidders though sources said that the Heavy Engineering Corporation (HEC) has bagged one order, while another went to the consortium of Emami and CFT. McNally Bharat has bagged the third one.
In fact, CFT, earlier a German company, was acquired by the Khaitans in 2009 with MBE Technologies Pte, a fully owned subsidiary of McNally Bharat, becoming its holding company.
?We hope that the Emami and CFT consortium would give the entire order to McNally Bharat for executing the project, since McNally has the technology to execute it,? Chandra said.
However, McNally Bharat has participated in all the 11 tenders floated so far but was not upbeat about the CIL projects since ?there are many petty players in the fray quoting very low rates,? Khaitan said.
He said that McNally was inclined to bag orders for washeries in Indonesia, Australia, South Africa and Mongolia and out of the $ 100 million order it was expecting to bag this year from across the globe, washeries would form a substantial part of it.
McNally, which reported a profit after tax of Rs 15.81 crore on a total income of Rs 685.69 crore for the quarter to September of 2010, against a PAT of Rs 9.54 crore on a total income of Rs 560.93 crore during the corresponding period last fiscal, was expecting a top line of Rs 18,00- 2,000 crore at the fiscal end.
The order book as on date stood at Rs 4,006 crore, while bids worth Rs 9,000 crore were at different stages decision, Prabir Ghosh, McNally?s president and chief financial officer, said.