To probe details, Ministry rejected coal block bids

The blocks were won by Jindal Power and Balco

The Centre had rejected bids for three coal blocks in the recently concluded auctions to find “conclusive evidence” of possible “outliers” in the bidding process.

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The Coal Ministry had rejected the bids for three blocks, two won by Jindal Power Ltd and one by Balco. “While the Nominated Authority’s report found outliers in the bidding process, it did not have conclusive evidence on the same. If we had accepted the bids, we could not have carried out further investigations,” a senior Coal Ministry official said on Monday.

While the Government was firming up its stance on a further probe, the winners of the blocks had taken legal recourse. The official said the Government still has the right to carry out an investigation, but as the matter is sub judice, the findings of such an investigation cannot be made public before the court proceedings are over.

Red flags

The Coal Ministry had rejected the bids of Jindal Power Ltd and Balco for the Gare Palma IV/2&3, Tara and Gare Palma IV/1 blocks, respectively, on March 21. On March 23, a Monday, Jindal Power Ltd approached the Delhi High Court challenging the decision. BusinessLine had earlier reported that only one bid was made for the Gare Palma IV/2&3 block even though there were four distinct qualified bidders — taking three bids of Jindal as one.

Also, there was aggressive bidding for power sector mines and the process continued beyond the initially scheduled two hours. However, for this mine, bidding was over in a much shorter time span – in about an hour.

Meanwhile, Coal Secretary Anil Swarup said on Monday that Phase III of the coal block auctions will start soon.

MoUA memorandum of understanding (MoU) is an agreement between two (bilateral) or more (multilateral) parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in situations where the parties cannot create a legally enforceable agreement... with Railways, Odisha

Earlier, the Ministry signed a Memorandum of Understanding with the Railway Ministry and Odisha Government to set up a new joint venture to identify and execute railway projects for evacuation of coal in the State.

Coal India will hold a 64 per cent stake in the joint venture while Indian Railways will hold 26 per cent and the Odisha Government 10 per cent. The venture will have an authorised share capital of ₹1,000 crore with an initial paid-up capital of ₹50 crore.

It will take up seven projects, requiring an investment of ₹2,525 crore, immediately.

“Speedier execution of projects through an independent corporation is the way forward. This is purely a profit making venture which will help Coal India produce more and sell more coal,” said Minister of State (Independent Charge) Power, Coal and New and Renewable Energy, Piyush Goyal.

Swarup added that the basic structure of the Memorandum of Understanding will be used for similar collaborations with other States.

Another MoUA memorandum of understanding (MoU) is an agreement between two (bilateral) or more (multilateral) parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in situations where the parties cannot create a legally enforceable agreement... with Jharkhand is expected shortly.

“The new joint ventures will undertake the projects through project-specific special purpose vehicles,” he added.

http://www.thehindubusinessline.com/economy/policy/to-probe-details-ministry-rejected-coal-block-bids/article7123043.ece

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