Home ECONOMY Jolt for Odisha as Centre rejects demand for coal blocks to OTPCL

Jolt for Odisha as Centre rejects demand for coal blocks to OTPCL

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Odisha Sun Times Bureau
Bhubaneswar, May 21:

The Odisha government has received a major jolt with the Centre’s outright rejection of its proposal for allocation of coal block to Odisha Thermal Power Corporation Limited (OTPCL), a 50:50 joint venture between state public sector units Odisha Mining Corporation (OMC) and Odisha Hydro Power Corporation (OHPC) through the nomination route.

File Pic
File Pic

Since OTPCL is a 100 per cent government-owned company, the state government had recommended the Centre to allocate Chhendipada and Chhendipada II coal blocks in Angul district in its favour.

What has come as a bolt from the blue for the state government is that the Union Coal ministry has told it in clear terms that no coal blocks can be allocated to any enterprise of the state government on nomination basis.

The Coal Ministry, in its letter to the state government, said a decision in this regard has been taken much earlier by the Ministry.

The Ministry’s letter further states that if OTPCL wants to get a coal block, it has to participate in the auction process for the said block.

The Centre’s rejection of its proposal has shocked the state government while leaving it worried about how to arrange coal for the OTPCL’s 2,400 MW coal-fired power plant coming up at Kamakhyanagar in Dhenkanal district.

The estimated to cost of the project is Rs 17,000 crore.

“The ministry has not honoured our request for allocating Chhendipada and Chhendipada II coal blocks to OTPCL. The letter from the ministry has made it amply clear that they are not going to award any more coal block to PSUs under the nomination route. Now, we have to take a call on whether OTPCL would take the auction route to get a coal block,” said Pranab Prakash Das, Energy Minister.

At the meeting of state power ministers held in Guwahati last month, Das had made a strong plea to award Chhendipada and Chhendipada II coal blocks to OTPCL. Out of eight coal blocks identified in Odisha for allotment to PSUs, only two – Manoharpur and dip side Manoharpur – coal blocks have been given to a state PSU, Odisha Coal & Power Ltd (OCPL), the minister pointed out.

It may be noted that on May 6, chief secretary GC Pati had written to the Ministry of Coal requesting it to allocate Chhendipada and Chhendipada II coal blocks to OTPCL.

The state government justified the demand stating that OTPCL was a 100 per cent government-owned company since it was a 50:50 joint venture between OMC and OHPC.

Previously, the Ministry of Coal had given Tentuloi coal block to OTPCL with deposits of 1,234 million tonnes. But the coal block was not commercially viable. Being an underground mine, it was very difficult to excavate coal there and therefore Chhendipada and Chhendipada II coal blocks were recommended for allocation to OTPCL, said Das.

The proposed power station needs 1,767.90 acres of land, including 1,074.95 acres of private land, 684.25 acres of government land and 8.7 acres of forest land.

The power purchase agreement (PPA) for sale of entire power generated at this project to Gridco has been executed.

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