Captive coal mines: Non-compliant firms forced to pay Rs 833-crore fine

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Published: June 26, 2019 4:56 AM

Captive coal mines produced 25.1 million tonnes (MT) of the fuel in FY19

coal, coal blocks, supreme court, scThe main reasons why reallocated blocks are yet to commence production are attributed to delays in receiving forest clearances, mining-safety permissions, land acquisition and ongoing litigation.

The government has deducted Rs 832.53 crore from the performance security of the captive coal mine-owning companies which did not meet efficiency parameters.

“So far, 134 show-cause notices have been issued for deviations from the scheduled time lines stipulated in coal mine development and production agreement/allotment agreements,” coal minister Prahlad Joshi said in a
response to a question tabled in Parliament.

Captive coal mines produced 25.1 million tonnes (MT) of the fuel in FY19. Though this figure is 55% higher than the production level of the previous fiscal, it is still much lower than the peak output of 43.2 MT in FY15, when 42 blocks were operational. The Gare–Palma– IV/8, Dulanga, Barjora, Ardhagram, Tadichelra – I blocks started producing coal in FY19 after remaining stranded in the previous two fiscals.

The Supreme Court, in its September 2014 order, had cancelled 204 captive coal block licences, saying that these had been allocated in an illegal and arbitrary manner. As many as 84 coal mines have been allocated so far after the cancellation of the coal blocks, out of which less than 25 are operational right now.

Also read: Govt invites technical bids for 4,000 MW Deoghar UMPP

The main reasons why reallocated blocks are yet to commence production are attributed to delays in receiving forest clearances, mining-safety permissions, land acquisition and ongoing litigation. These apart, many of the reallocated blocks are yet to start production because the developers, who won the blocks in auction, are in financial distress.

The government had earlier claimed that coal-bearing states will get revenue to the tune of `3.4 lakh crore over 30 years (about Rs 11,467 crore annually) from the 31 auctioned and 42 blocks allotted to Central or state government companies. Sources say the states have earned total revenue of `6,000 crore (excluding royalty, cess, taxes etc) till October 2018.

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