India State Selects Jindal Steel, Adhunik Group Firm For Coal Blocks – Officials
Jindal Steel & Power Ltd. (532286.BY) and a unit of Adhunik Metaliks Ltd. (532727.BY) are among three companies shortlisted by the eastern Indian state of Jharkhand to develop three coal blocks at a total investment of INR11.75 billion ($237 million).
The three companies are to produce 3.6 million metric tons of coal annually in the next few years to feed their own projects, two senior officials at Jharkhand State Mineral Development Corp. told Dow Jones Newswires recently.
The agency, which is responsible for developing mineral deposits in the state, last year invited bids for joint development of three blocks–Rabodh, Patratu and Pindra Debipur–with combined reserves of 645 million tons of coking and non-coking coal. The bids were opened last week. Jharkhand State Mineral Development was earlier warned by the federal coal ministry that the allotment of these blocks could be cancelled due to a delay in developing them. This has prompted the agency to seek developers for the blocks allotted to it in 2006 and 2007. India, which is facing a coal shortage of at least 114 million tons in the current financial year through March, has so far given 195 blocks with about 43.34 billion tons of reserves to private and government companies to mine the fuel for their own projects. But, only a few of them are in production. One of the Jharkhand officials said the final agreements to develop the fields are likely to be signed in 15 days. Both officials didn’t want to be named before the agency announces the winning bidders. According to them, Jindal Steel & Power emerged as the successful bidder to develop the Rabodh block, which is likely to entail an investment of INR6.25 billion to produce 2.5 million tons of coal annually. Orissa Manganese Minerals Ltd., a unit of Adhunik Metaliks, won the Patratu block, which is likely to require an investment of up to INR3.00 billion to produce 0.8 million tons a year. AMR Coastal Ltd., a joint venture between AMR Group and Coastal Projects Ltd., won the bid for the Pindra Debipur block, which will require up to INR2.50 billion to produce 0.3 million tons of coal a year.
Executives from Adhunik Group and AMR Coastal confirmed the development, but refused to be named as they haven’t received any formal information. A Jindal Steel & Power executive confirmed bidding for Rabodh coal block, but didn’t say if the company has won the mining rights.