Low bids: 5 blocks under scanner, decision today

The fate of five mines won by firms like Hindalco, Jindal Power and Usha Martin has been uncertain.

Written by Priyadarshi Siddhanta | New Delhi | Published: March 17, 2015 1:37 am

The coal ministry is likely to decide the fate of five ready-to-operate coal blocks — which are being examined for receiving “lower-than-expected” bids — by Tuesday, even as it begun executing contracts with successful bidders of coal blocks on Monday.

The five blocks have already been electronically auctioned but not yet awarded. The ministry has so far auctioned 32 coal blocks out of the 204 mines cancelled by the Supreme Court in September last year after holding their allocation as illegal and arbitrary. The bids were executed between February 14 to March 9. Proceeds worth over Rs 2 lakh crore have been mobilised from the bids, which would go to the states where the blocks are located over 30 years.

While the ministry has begun signing pacts with successful bidders from two rounds of auctions so far, the fate of five out of 14 mines auctioned in the second round, which have been won by firms like Hindalco, Jindal Power and Usha Martin, has been uncertain. The blocks in question are Tara, Brinda and Sasai, Meral, Dumri and Mandla South.

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“We have received an inter-ministerial committee’s (IMC) report on the reasons for the bids for these blocks and are perusing it. By tomorrow (Tuesday) we would firm up our views,” a source in the coal ministry said. Another source in the IMC said it is more than a week that the panel has sent the report and now it is up to the ministry to take a call. Refusing to divulge further details, the source said the committee has opined “very clearly” on various aspects of the bids. But it is unclear whether the ministry is planning to re-bid the five mines.

It is learnt that the government is likely to proceed with the next tranche of auctions of over two dozen mines soon irrespective of the outcome of the passage of the Coal Mines (Special Provisions) Bill, 2014, in Parliament.

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