Coal block auction: Crisil to submit report on reserve price

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Amid allegations of irregularities in coal blocks allocation, the government has asked Crisil to submit a report within three months on the methodology to determine the reserve price for auction of 54 mines it has identified for allocation.

The Coal Ministry has identified 54 coal blocks a few days ago for various sectors, including 16 for power, 12 for steel and 12 for government firms among others.

"We have given the offer letter to Crisil and asked it to provide us report within three months on the methodology of fixing the reserve price of blocks to be auctioned," a source close to the development said.

Crisil had emerged as the lowest financial bidder for the Coal Ministry's contract to prepare the methodology. It provides ratings, research, and risk and policy advisory services.

The moves comes amidst the CBI initiating a preliminary inquiry in connection with the alleged irregularities in the utilisation of coal blocks allocated to private companies between 2006 and 2009.

It is also being alleged that there was a delay of nearly two years in auctioning process and the ministry has done so to benefit some private players.

In February, Coal India Ltd subsidiary - Central Mine Planning & Design Institute (CMPDI) - on behalf of the Coal Ministry, had invited an expression of interest for providing consultancy services.

CMPDI has been assigned the task of hiring a consultant for the methodology of fixing the reserve price of blocks and finalising the bid document, and assist in bidding process.

Earlier, Coal Minister Sriprakash Jaiswal had said the government is almost ready to auction coal blocks through competitive bidding.

In a draft report, the Comptroller and Auditor General (CAG) had estimated a Rs 10.6 lakh crore loss to the exchequer on account of allotment of coal blocks during 2004 to 2009 without auction to 100 private and public sector companies.

However, Jaiswal while addressing the media had said on Saturday said there was no scam in allocation of coal blocks and his department was not aware of any CAG report on the issue.