Mines Bill, a boost to manufacturing: India Inc
India Inc has said that the passage of the Mines and Minerals Development and Regulation (MMDR) Bill 2015 in the Rajya Sabha on Friday will give a boost to “languishing’’ mining activities in the country and give a fillip to manufacturing.
Despite strong resistance from the Opposition, the Bill was passed in the Upper House on the last day of the first leg of the current Parliament session and will now be sent to the Lok Sabha. The Parliament session will resume on April 20.
The Confederation of Indian Industry (CII) said the Bill “will bring in much-needed transparency in the allocation process and kick-start the mining sector which was languishing for want of clear guidelines.”
“The Bill will pave the way for restarting mining in the country, thereby easing the pressure on availability of raw material, so vital for many key sectors that provide inputs to manufacturing,” CII said.
Industry body Assocham also echoed the sentiments and said the Bill would augment mines’ productivity.
Rana Kapoor, President of Assocham, said, “Now there is a likelihood of increase in production of iron ore that will help the domestic steel industry as augmenting steel production capacity is crucial for growth and development of the manufacturing sector.”
Alok B Shriram, President, PHD Chamber, said the Bill will bring down the cost of doing business by facilitating auctions of mines supplying minerals such as iron ore and bauxite, and bringing down the costs of raw materials.
“Going ahead, we expect the Lok Sabha to pass the Bill for speedy allocation of the mines that would bolster industrial growth,” Shriram added.
38 coal mines allotted to Central, State PSUs
The Coal Ministry on Tuesday allotted 38 mines to Central and State public sector units including NTPC and SAIL, Coal Secretary Anil Swarup said.
The allotment to Centre and State entities comes after the Government recently ended two rounds of auctioning of coal blocks for private companies. The Supreme Court had in September 2014 cancelled the allocations of 204 blocks, leading to the current auctions and allocations.
Most of the mines allotted are for the power sector, except one Sitanala mine given to SAIL. A majority of the mines have gone to the earlier allocatees.
Out of the 38 mines, eight — Barjora, Barjora (North), Gangaramchak & Gangaramchak Bhadulia, Tara East & Tara West, Pachwara North and Kasta East — have gone to West Bengal Power Development Corporation Ltd.
Karnataka Power Corporation Ltd has been awarded six mines — Baranj I, II, III & IV and Manora Deep and Kiloni.
NTPC got five mines — Chhatti Bariatu, Chatti Bariatu (South), Kerandari, Talaipalli amd Dulanga.
Damodar Valley Corporation has been allotted Khagra Joydev mine. Rajasthan Rajya Vidyut Utpadan Nigam was allotted three mines — Parsa East, Kanta Basan and Parsa, while Chattisgarh State Power Generation Company has been given three mines — Gare Palma Sector III, Gidhmuri and Patoria.
Odisha Coal and Power got two blocks — Manoharpur and Manoharpur Dipside blocks.
The Ministry had received 107 applications from public sector undertakings for allocation. The Government has already earned over ₹2 lakh crore by auctioning just 33 blocks, surpassing the ₹1.86-lakh crore loss estimated earlier by government auditor CAG for allotment of mines without auction.
Monnet Ispat in talks to sell part of power arm
Monnet Ispat & Energy is in preliminary talks with potential buyers for selling partial stake in its power business, Monnet Power Company, which has significant liabilities.
While the identities of the potential buyers were not disclosed, reports suggest that Adani and JSW groups are in the race.
“The company is at preliminary stage of discussion with few buyers to explore sale of its part stake in Monnet Power Company Limited,” Monnet Ispat & Energy (MIEL) said.
Without naming the buyers, it said in a filing to the BSE that “the discussions are at an initial stage and the deal, if fructified, is subject to the due diligence and agreement on the commercial and other terms and conditions”.
After reports that groups like Adani and JSW are in race to buy controlling stake in Monnet Power for over Rs. 3,000 crore, Monnet Ispat informed the BSE that “whenever any such development happens, the company will inform the stock exchange In compliance of the listing agreement”.
A person privy to the development said, “Adani Group has received the proposal from Monnet. As it has closed the Udupi deal recently, no decision has been taken yet on this proposal.” It had acquired 1,200 MW Udupi power plant from Lanco Infra.
An Adani spokesperson declined to comment on the issue.
When contacted, a JSW spokesperson said the company was not doing any due diligence for assets of Monnet Power.
“We continue to evaluate various growth opportunities; however, the company is not in any conclusive discussions for any particular project,” he said.
“JSW Energy, as part of its growth strategy, looks to evaluate opportunities for growth, both organically and inorganically,” the spokesperson added.
MIEL has been an independent power producer (IPP) through its subsidiary Monnet Power Company Limited (MPCL) by setting up a thermal power plant of IPP of 1050 MW, backed with pit head captive coal mine in Angul, Odisha. The company claims that the project will be amongst one of the lowest cost generation units.
The company is also setting up additional super critical 660 MW power plant at the same site and is fully equipped in terms of the land requirement and fuel for the same.
As per sources, the proposed sale aims at reducing debt of Monnet Power which stood at Rs. 4,000 crore in March 2014.
However, Monnet Ispat officials did not respond to repeated queries in this regard. Monnet Power has faced “challenges of delayed disbursals, late approvals and… land acquisition in the beginning resulting in time and cost over—run of the project. The revised cost of project is pegged at Rs. 7,117 crore instead of Rs. 5,092 crore earlier,” the company’s annual report said.
“Similarly, the COD of the project has been revised to September 2015 instead of December 2012 earlier, with unit—I expected to be commissioned by March 2015 and unit—II by September 2015,” it added.
Mesco, Posco sign MoA for Finex plant
South Korean steel company Posco and India’s Mesco Steel signed a memorandum of agreement on Tuesday for a Finex technology plant of the former to be relocated to India, senior executives in the companies confirmed.
“It is true that an MoA has been signed… Details will be announced later,” Manish Pande, vice president—strategy of MESCO said.
The spokesperson of Posco IG Lee confirmed the development via a text message without giving further detail.
“An MoA has been signed today and the companies are in talks for the formation of a joint venture,” a senior official in Mesco said without wishing to be named.
The unnamed official in Mesco said Posco is likely to take a minority stake in the plant that will be dismantled in Pohang in South Korea and rebuilt at Mesco’s plant site in Kalinganagar in Odisha, according to plans.
Last year the two companies signed a memorandum of understanding to explore the possibility of the transfer of the plant and the environment friendly technology which will lower the cost of steel production as it can directly use iron ore fines and thermal coal.
An analyst said the two companies are pushing ahead with their plans despite the lean phase in the steel market because Posco is eager to showcase its technology that it believes is best suited to Indian conditions.
Mesco on the other hand is keen to get the low-cost steel making technology first.
This post was written by Atlantic Admin