The Attorney General had informed the Supreme Court that 41 blocks allocated would be taken back if environment clearances were not obtained in 6 weeks.

The Government will decide the fate of 61 coal blocks next month. Mine owners in these blocks have been asked to submit a status report by February 5 on developing the assets.

A letter from the Coal Ministry to the firms owning the 61 blocks said that they would be given three weeks to obtain the requisite approvals and produce supporting documents. Within a week thereafter, a “decision for de-allocation will be taken,” it added.

This follows Attorney General Goolam E. Vahanvati informing the Supreme Court on Wednesday that nearly 41 coal blocks allocated to private companies would be taken back if they did not obtain environmental clearances within six weeks.

The companies include Tata Steel, Tata Power, Rungta Mines, Essar Power, Hindalco Industries, Adani Power, Arcelor Mittal India, GVK Power, CESC, Monnet Ispat, Sterlite Energy, GMR Energy, Jindal Steel and Power, Bhushan Power and Steel, Jaiprakash Associates, and GVK Power.

Critics are drawing a parallel with what happened in the telecom sector in 2012 when the Supreme Court cancelled 122 licences issued in 2008.

The Coal Ministry has sought details on whether the mining lease has been executed or applied for, the status of green clearances, and if prospecting licences for the blocks have been obtained and geological reports prepared.

Companies that have already received environmental clearances and first-stage forest clearance have been asked to respond by February 12.

Interestingly, the Coal Ministry has sought no information on the end-user projects attached to these mines. It is not immediately known how much has been invested in these projects.

Industry sources say that there may be cases where end-use projects are ready but the coal block is held up due to regulatory clearances.

For example, in the case of the Mahan coal block allocated to Essar Power, the project was for long stuck over environmental clearance before an Empowered Group of Ministers cleared the block. The first unit of 600 MW has already been commissioned, while the second is under construction. The company has invested Rs 5,000 crore in the power plant.

(This article was published on January 16, 2014)
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