Ministry rejects RINL's plea for coking coal blocks swap

The Coal Ministry has rejected Rashtriya Ispat Nigam Ltd's (RINL) request to swap two coking coal blocks in Jharkhand with other reserves in the region.

“As regards allocation of alternative coal block(s), there is no policy/guidelines for allocation of alternative coal block in lieu of surrendered coal block,” Coal Ministry said on its Web site.

RINL was allocated the Mahal block in 2005 and Tenughat-Jhirki block in Jharkhand in 2008 to meet the coking coal requirement of the company's steel plant in Visakhapatnam. Both these blocks had reserves of about 500 million tonnes.

However, after the pre-feasibility studies, RINL found out that these blocks had faults, high gaseous deposits, very deep workable seams and other obstructions.

As a result, developing these blocks would incur huge investments and production costs, whereas the production yield was projected to be low, at an estimated 4 per cent.

In view of the difficulty faced by the company in developing these blocks, the Steel Ministry and RINL sought Coal Ministry's permission to surrender them in lieu of two alternative blocks in the region. Considering the delay in developing these blocks in view of the terms and conditions of the allocation letter, the Coal Ministry de-allocated the two coking blocks early this month.

Instead, the Coal Ministry has asked the steel firm to apply afresh for coal blocks. “RINL is at liberty to apply for blocks as and when applications for a fresh list of coal blocks are invited. The request will be considered along with other applications, as received then, as per the guidelines for allocation of coal blocks,” Coal Ministry said.

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