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Home News Power Sector News Andhra Pradesh cancel tenders for privatisation of coal mines

Andhra Pradesh cancel tenders for privatisation of coal mines

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Coal mineThe Andhra Pradesh government has decided to cancel the tenders it had called for to privatise the Tadicherla coal mines in Karimnagar. The move comes in the wake of allegations that the government is favouring a particular a private company bypassing the state-owned Singareni Collieries Company Limited. Tenders were opened on January 11 and it was found that the Hyderabad- based ETA-ECCI-PLR Joint Venture had bid the lowest - offering coal at Rs 2,499 per tonne. But a controversy erupted after inquiries revealed that Kadapa MP Y. S. Jaganmohan Reddy and state forest minister P. Ramachandra Reddy held huge stakes in the consortium.

And there were allegations that AP Power Generation Corporation (APGenco) had deliberately forced Singareni to opt out of the bidding though it has been supplying coal to APGenco's power stations at Rs 1,128 per tonne. Tadicherla block-1, a captive coal mine, was allotted to APGenco by the Union coal ministry in December 2005. It was to meet the coal requirements of its Kakatiya Thermal Power Station at Bhoopalpally in Warangal district. Since APGenco did not mine coal, it had invited bids for the mining and supply of coal - worth Rs 5,000 crore - from the Tadicherla mine.

In 2008, six companies - Singareni, Essel Mining- CISC Consortium (Mumbai), Sainik Mining and Allied Services Joint Venture (New Delhi), Indu-BGR Consortium (Hyderabad), ETA-ECCIPLR Joint Venture (Hyderabad), Tadicherla Coal Mining Consortium (Hyderabad), submitted bids for mining.

But Singareni opted out, citing it was an expensive proposition. Three companies -- Indu-BGR, Tadicherla mining and ETA-ECCI-PLR-AMR -- had remained in the fray for technical qualification.

The CM has now directed the energy department to cancel the tender process and has agreed to consider a proposal to entrust mining to a joint venture of Singareni and APGenco.

They pointed out that in the wake of the ongoing Telangana agitation, if the government awarded the tenders, it would lead to a mass movement in the area. Karimnagar district falls under the Telangana.

Several trade unions had opposed the privatisation move, as they claimed it would result in huge loss to both Singareni as well as APGenco.

Telangana Rashtra Samithi president K. Chandrasekhara Rao had alleged that corruption involving crores of rupees was behind the decision to award the contract to a private company.

"How can APGenco pay more than double the amount to a private company compared to what it is paying to Singareni to buy coal? The project should be handed over to Singareni," he had said.

He has demanded a high-level probe into why a public sector undertaking was ignored in the process.


Source- India Today
 

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