HYDERABAD: The Supreme Court’s recent order cancelling all the coal allocations made to private companies by the erstwhile UPA government could well throw up a major opportunity for the State-owned public enterprise, Singareni Collieries Company Ltd (SCCL), to move beyond its territory.
In a recent communication to the Centre, the Telangana government has requested that SCCL, given its expertise in coal mining, should be allocated coal blocks in the neighbouring States of Maharashtra, Madhya Pradesh, Chhattisgarh and Odisha.
What could swing matters in favour of the 125-year-old company, subject to the TS government pursuing the matter seriously, is that the new policy that came into being following the apex court order, provides for allocation of coal blocks through the government route to State-owned enterprises while public auction mode has to be followed in respect of private entities. Following the SC order, the NDA government has issued the Coal Mines (Special Provisions) Ordinance facilitating direct allocation of mines to a government company or corporation which is not partnering with any private firm.
In the case of SCCL, 51% of the equity is held by the Telangana government while the rest is owned by the Government of India. According to reliable sources, Dr SK Joshi, Principal Secretary, TS Govt, sent a letter to AK Bhalla, Joint Secretary in the Ministry of Coal, on Nov 11, recalling that SCCL had repeatedly asked for allocation of coal blocks even in the past but was not given any. He pointed out that private companies that were allotted the blocks had subsequently approached the SCCL for technical advice or for firming up a joint venture.
A few days before this, the sources indicated, SCCL Chairman and Managing Director Sudeerth Bhattacharya had also sent a letter to Bhalla in which he said production in underground mines had been unsatisfactory owing to unfavourable geological conditions.
Even in open cast mines, a variety of factors have been resulting in less than desired production levels. The letter said SCCL could be considered given that a) it is the oldest government company in the coal field with expertise in planning, exploration, survey and R & D; b) the company has skilled manpower for operation and maintenance of both underground and open cast mines; c) the new State requires to add about 8000 MW of power generation and allocation of coal blocks will help meet the demand for raw material requirement. Allocation of coal blocks in neighbouring states will also help in limiting the transport and requirement of wagons, apart from reducing environmental hazards caused on account moving high ash content coal over a long distance.
Happy ending?
Way back in 2008 itself, the then SCCL MD, S Narsing Rao, who is at present principal secretary in the Telangana CMO, wrote to the Coal Ministry that due to exhaustion of reserves in the Godavari Valley, it was becoming difficult to take up new projects for sustaining coal linkages. He pointed out that though the Centre began allocation of coal blocks for captive mining since 2003, not even one was given to SCCL despite repeated requests. He sought at least four of the 47 identified blocks in Coal India jurisdiction for SCCL. But, in vain. This time, it could be different with sources indicating that it was a senior official in the Union Government who had suggested to TS that it should make a case for allocation of blocks in the context of the SC order.