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    HomeBusinessGovt penalises NTPC, Ultratech Cements for non-operationalisation, missing output target from coal...

    Govt penalises NTPC, Ultratech Cements for non-operationalisation, missing output target from coal blocks

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    Companies

    The issue relates to coal blocks allocated to companies for captive end use and sale of coal and/or commercial mining.

    The Coal Ministry on Friday said it has penalised four companies, including NTPC and Ultratech Cements, for delays in operationalisation and missing production targets from coal blocks allocated to these companies. The ministry’s action follows recommendations by the Scrutiny Committee.

    The issue relates to coal blocks allocated to firms for captive end use as well as for the sale of coal and/or commercial mining. The ministry has formed a Scrutiny Committee to consider the show cause notices and replies received from allocattees on a case-to-case basis and recommend penalties in cases where the delays are attributable to the allocatees.

    Performance scrutiny

    “The Scrutiny Committee, in its 17th meeting held recently, has reviewed cases of 24 coal mines and recommended proportionate appropriation of Performance Security in four cases—Tenughat Vidyut Nigam (Rajbar E&D), Topworth Urja & Metals (Marki Mangli-I), Ultratech Cements (Bicharpur) and National Thermal Power Corporation (Talaipalli) due to delay on the part of allocatees,” the Coal Ministry said in a statement.

    The recommendations of the Scrutiny Committee have been accepted by the government and appropriation orders are being issued, it added.

    Show cause notices

    The Committee also slapped show cause notices on 16 companies for 22 coal blocks, including Hindalco Industries, JSW Steel, Birla Corp (2 blocks), Vedanta (3 blocks), Damodar Valley Corporation, West Bengal Power Development Corporation, Karnataka Power Corporation (2 blocks) and National Aluminium Company (NALCO).

    “Show cause notices are issued from time-to-time to the companies which are not adhering to the timelines prescribed in their agreements for timely operationalisation of coal blocks or for non-achievement of targeted coal production,” the ministry said.

    Besides regular follow-ups, review meetings are also held by the Ministry with the block allocatees and the respective state/central agencies like the Union Ministry of Environment, Forest and Climate Change, State mining departments, State revenue departments, State forest departments, etc. for early operationalisation of the blocks and to enhance the production from operational blocks, it added.

    A Project Management Unit has also been appointed by the Ministry for handholding of allottees in obtaining the statutory clearances for early operationalization of coal blocks.

    Coal production

    The Ministry has allocated coal blocks for captive end use and sale of coal/ commercial mining. During FY22, 85.32 million tonnes (MT) of coal was produced from 47 operational coal blocks.

    As against the scheduled production of 203.MT for FY 23, it is expected that a total of 58 coal blocks will become operational with an expected production of around 138.28 MT.

    India’s coal consumption has witnessed a steep rise from 956 MT in FY20 to 1,027 MT in FY22. All India coal production has also increased from 716 MT in FY21 to 777 MT in FY22. Domestic dispatch has also risen from 691 MT in FY21 to 818 MT in FY22.

    Published on June 03, 2022

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