Millennium Post

Cancelled JSPL, Balco mines given to Coal India Ltd

“Three coal blocks - Gare Palma IV/1, IV 2 and IV 3 under Schedule II mines (blocks under production) have been today alloted to Coal India Ltd. JSPL and Balco had been successful bidders for these blocks,” a highly placed source said.

The development comes amid Jindal Steel and Power Ltd today moving the Delhi High Court against the decision of the Centre to cancel the coal blocks saying that the company apprehends that the blocks might be allocated to someone else as the government is “moving very fast”. The source said the government decided promptly to allot the blocks to Coal India as the Supreme Court had allowed companies to continue mining till March 31 in blocks where coal production had already started.

Total reserves of the three mines amount to 313.68 MT. The government had cancelled four blocks including Tara which falls under Schedule III (ready for production) category on March 20 saying the bids were undervalued and it will take a final call on these soon after deliberations. The four coal blocks whose bids were rejected include Gare IV/2, Gare Palma IV/3 and Tara coal blocks in Chhattisgarh in which JSPL had emerged as the highest bidder and Gare Palma IV/1 mine for which Bharat Aluminium Company (Balco) had emerged as highest bidder.

Government re-examined the bids for nine coal blocks in the recently held auction amid reports that some bidders could have indulged in cartelisation to keep the prices low for these mines. While JSPL is yet to respond to the government move, Balco declined to comment on the development.

“Bids for Gare Palma IV/1, IV/2, IV/3 and Tara coal blocks not accepted,” Coal Secretary Anil Swarup had earlier tweeted. However, bids for five other blocks which were accepted are Marki Mangli III mine, (with B S Ispat as the successful bidder), Mandla South mine (Jaypee Cement), Usha Martin Brinda and Sasai mines (Usha Martin), Dumri mine, (Hindalco Industries) and Meral mine (Trimula Industries).

Through auctioning just 33 blocks, the government has garnered over Rs 2 lakh crore, surpassing the Rs 1.86 lakh crore loss estimated earlier by government auditor CAG for having given away mines to companies without bidding.

JSPL shares slump 15%

Shares of Jindal Steel and Power slumped as much as 15 per cent in morning trade on Monday after the government rejected bids made by the company during the auction of coal blocks held recently.

Reacting to the development, shares of JSPL opened on a weak note, then lost further ground and slipped 14.97 per cent to touch an intra-day low of Rs 140.25 on the BSE.

Similar movement was witnessed on the National Stock exchange as well, where the stock opened at Rs 150, then fell 14.91 per cent to a low of Rs 140.
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