Jindal’s bid among three unapproved by govt.Monday Down FREEZE ?Target 155-151–133 ?
21 March 2015 - 9.07 a.m
After two weeks of re-examination, the coal ministry did not approve bids received for three of the eight coal blocks being scrutinised, citing “comparatively low bids”. Two of these were won by Jindal Steel and Power. These blocks are likely to go to state-owned Coal India till any further action, said sources.
The two that were won by Jindal Steel and Power are Tara in West Bengal and Gare Palma IV/2&3 in Jharkhand, meant for power generation. The third coal block meant for steel, cement and iron sectors, Gare Palma-IV/1 in Jharkhand, was won by Bharat Aluminium Company (Balco).
Sources in the government said because of stark differences between bids in the same category, these were not approved. Among the eight blocks for which bids were being re-examined, five have been approved.
The bids in question were put by Jindal Steel and Power,Balco and B S Ispat in the first phase of auction. In the second phase, low bids from Jindal Steel and Power, Hindalco, Usha Martin and Tirumala Industries led the government to initiate a re-examination.
Jindal Steel and Power will be hit the most, losing two mines. The other loser is the Vedanta Group-promoted Balco. Jindal Steel and Power had won back its Gare Palma-IV/2&3 block at the lowest bid, Rs 108 a tonne.
Senior government officials said their analysis showed the bids for these blocks were found to be too low compared with those from the same sectors for other blocks.
“While the winning bid for Gare Palma-IV/2&3 for end use in power generation was Rs 108 a tonne, other blocks for same end use received bids in the range of Rs 370-1,110 a tonne. So, the company’s bid was only Rs 8 beyond the reserve price,” said an official, requesting anonymity. Jindal Steel and Power won Tara block in the second phase of auction for Rs 126 a tonne, while the bid range from the power sector was Rs 202-670 a tonne.
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