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Govt panel to assess value of coal blocks

business Updated: Oct 29, 2014 08:45 IST
HT Correspondent
HT Correspondent
Hindustan Times
Central Vigilance Commissioner

The government has formed a committee under former Central Vigilance Commissioner Pratyush Sinha to assess compensation to be paid for taking over the coal mines that were running or ready for operations.

The committee, which will comprise officials of the ministries of coal, power, finance and law, will submit its recommendations by November 10, sources close to the development said. The committee has also been authorised to engage experts/ consultants for valuation of running coal mines.

The Supreme Court had on September 24 cancelled allocation of 204 coal blocks to various companies between 1993 and 2009.

Out of these, 37 are running coal mines and another five are ready to produce by April. Unlike others, their cancellation is to take effect from April 2015.

Sources said the committee has been asked to value assets of each of these 42 coal blocks for mining infrastructure such as tangible assets used for coal mining operations, fixed installations and land.

“The committee shall recommend the value of the assets to be paid for acquisition,” one of the source said.

Also, the panel would carry out assessment of the liabilities associated with the operations of the mine.

Sources said the government wants to clear all roadblocks and meet conditions for the new owner of the mines, which will be decided through an e-auction, to takeover operations of the 42 mines from April next year.

Keen to avoid any supply disruption, the government on October 21 promulgated an ordinance to revert half of these 42 mines to the government entities that were the original allottees.

The remaining 21 will be put on auction in the first phase of bidding that will be open for end users in the power, cement and steel sectors.

If the winner of any of these 21 mines is different than the one already operating, the existing owner will be paid compensation before operations are handed over, sources said.