The world’s biggest steel producer ArcelorMittal runs the risk of losing its allocated coal mines if they continue to be idle. Intensifying its drive to enforce accountability on companies that have kept their blocks of coal mines idle, the coal ministry has threatened ArcelorMittal and Andhra Pradesh-headquartered GVK Power of de-allocating the Seregarha block jointly allocated to them.

The ministry has issued a notice jointly to steel tycoon Lakshmi Niwas Mittal’s company ArcelorMittal and GVK Power (Goindwal Sahib) for failing to develop the Seregarha block in Jharkhand, which has reserves of nearly 200 million tonne. Notices have been sent also to several other power and mining companies run by states for delaying production from their blocks.

“We have no other option except to act strongly against the companies idling on their blocks. What do we do? We have reminded them several times to expressly initiate measures to meet their promised milestones, but during the review meetings they are clueless,” a ministry official said.

If the ministry has its way, at least four companies may lose their blocks besides forfeiting their bank guarantees. Among these, 25 are state-run companies, while 15 are private firms.

Elaborating on the “show-cause” notice served on Arcelor Mittal and GVK Power, the official said during review meetings on October 15-16 last year, the companies were told that their progress was very slow “and there seemed to be no intention on the part of the allocatees to develop the block”.

Then in another review meeting held on June 22 and 23, the ministry found out that they had not even secured the prospecting licence and that the exploration had not yet begun, “As per the time schedule for development of the block, it should be nearing completion by now,” the official said.

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