Coal panel asked Hindalco to form JV with PSUs

The FIR has alleged a criminal conspiracy between Parakh and KM Birla,chief of the Aditya Birla group,whose company,Hindalco,was allowed to join a joint venture with public sector Neyveli Lignite Corporation (NLC) and Mahanadi Coalfields (MCL). It alleged Parakh overturned the decision of the committee to favour Hindalco later.

The minutes of the screening committee meeting held on January 10,2005 reads that while Parakh asked the company representatives their views on a joint venture,the company stated that they would need time to give their reaction on the same. It also adds representative from government of Orissa supported allocation of Talabira to the applicant company.

CBI sources on Wednesday had claimed the agency had found a letter written by state chief minister Naveen Patnaik to the PMO requesting a relook at the decision to reject Hindalcos request for the block. It turns out the support from the state was consistent and open. The records of the screening committee have been submitted by the coal ministry to CBI sometime ago.

The committee finally decided that while NLC and MCL should operate the mines through a joint venture,Hindalco having already secured a long-term coal linkage (committed coal supply from CIL) for their upcoming 720 MW project did not need a block. This was as per government policy which stated that companies in the private or public sector could get either a linkage or a captive coal block,but not both.

A copy of the screening committee meeting in possession of The Indian Express shows that in 25th meeting,the Hindalco officials were asked that though they had got another mine Talabira I against which they had promised to set up a 50 MW power plant,the project was still unfinished. Instead the coal was being used for an existing older plant of the company. The representative stated that they had not come prepared for Talabira I case and would reserve their comments. There were two objections recorded by the committee to allocate a coal block to Hindalco. The first was that their project was at a nascent stage,while others who are about to complete theirs had more pressing needs.

The second was that the committee had found that the project has already been provided long-term linkage of 3.06 million tonnes per annum by MCL. This linkage would meet the full requirement of the project. No separate block,therefore needs to be given to Aditya Aluminium project.