Companies

Jindal Power wins back coal block in Chhattisgarh, beating Adani, Reliance

Our Bureau New Delhi | Updated on January 24, 2018 Published on February 19, 2015

CAG stance vindicated, says Sitharaman; Adani Power fails to win single block

Naveen Jindal’s Jindal Power Ltd won back its previously held block — Gare Palma IV/2 & 3 in Chhattisgarh — on day six of the coal block auctions on Thursday, beating Adani Power, Anil Ambani Group’s Reliance Geothermal, GMR and others.

Jindal Power’s bid of ₹108/tonne emerged as the highest for the block, which has extractable reserves of 155.49 million tonnes.

Following the win, Jindal Power’s parent Jindal Steel and Power’s scrip closed 25.59 per cent higher on Thursday at ₹195.30.

Till late Thursday evening, State governments earned close to ₹75,000 crore from bids on the 15 blocks sold so far, along with around ₹10,000 crore in royalty. Both will accrue to States over the mines’ life.

‘CAG vindicated’

“Certainly, the CAG’s position has been vindicated but I am underlining the larger issue here ... our position has been vindicated,” said Commerce Minister Nirmala Sitharaman on Thursday, reacting to the response to the auctions. The CAG had estimated a revenue loss of ₹1.86 lakh crore, blaming the UPA government’s policy of block allocations.

Crucial block

Gare Palma IV/2&3 was crucial for Jindal Power as it has already developed power plants based on fuel from the block. JSPL’s Chief Financial Officer K Rajagopal said the coal can be used to address the requirements of the 1,000 MW Tamnar Power Plant in Raigarh district of Chhattisgarh. The plant already has power purchase agreements in place.

Jindal’s bid for Gare Palma IV/2 & 3 is also the lowest among the seven power sector blocks sold in the ongoing auctions. On Wednesday, Essar Power had paid the highest for a power sector block, at ₹1,110 per tonne.

Bidding for the Gare Palma IV/5 had concluded in the early hours of Thursday.

The block was won by Hindalco for ₹3,502/tonne. This was the second block won by the Aditya Birla Group company.

The result also means that despite bidding for each of the power sector blocks, Adani Power has failed to win any of them. The Gautam Adani-led company will now have to wait for the ready-to-produce blocks for which bidding will begin from February 25.

Bidding for the Bicharpur block in Madhya Pradesh, which was also under the hammer, was still going on till late in the evening. At 8.08 pm, bidding was on for the block at ₹2,909/ tonne.

Published on February 19, 2015
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