After a long wait and some back and forth, Odisha has rejected Jindal Steel and Power Ltd’s bid for the Guali iron ore block, forfeiting the steelmaker’s INR 39.87 crore bid security.
The state government has ordered its letter, recognising JSPL as the successful preferred bidder of the 18 March 2020 auction, as infructuous. Similar orders have been issued for Shyam Ore’s bid for Jilling-Langlota and Tarama Apartment’s bid for Tehrai iron ore and manganese deposit.
As SteelMint reported recently, Odisha has already moved to entrust the 365.02 ha Guali block and the 456.1 ha Jilling -Langlota block to a state -owned corporation.
JSPL had offered a 144% premium for Guali but failed to pay the first installment of INR 19.93 crores, or 10 percent of the upfront payment, before its deadline of 5 Oct’20. It had been issued a cause notice on 15 Oct 2020 even as the company claimed discrepancies in land boundaries. The state claims the DGPS surveyed map was verified by a joint team, supervised by the Supreme Court’s Central Empowered Committee, and no one had raised any doubts. “Hence, raising any issues after conclusion of the auction is nothing but looking for grounds to move out of the auction for the reasons best known to it (JSPL) which could be even economic viability of the final bid offer quoted by it,” reads the order. It adds that the tender document is clear that “the state Government accepts no responsibility for the accuracy or otherwise for any statement contained in the tender document.”
Shyam Ores
Neither JSPL nor Shyam Ores have been barred from participating in future auctions but the state reserves its right to bar them for five years if it chooses to. Tarama Apartment though has been barred from participating in future auction of the Tehrai
Unlike JSPL, Shyam Ores paid two installments of INR 9.06 crores each of the upfront payment, a bank guarantee of INR 90 crore and the third installment of INR 72.48 crores two days before its deadline of 28 June 2020. The state nonetheless believes it failed to comply. The order points out that despite 27 June and 28 June being holidays, others in similar positions such as JSW Steel and ArcelorMittal had signed MPDA and lease agreements, while Shyam Ores had failed to do so. Jilling-Langalota which has railway sidings attached will also be reserved, for now, for a state PSU.
The Nadidih blocks
Meanwhile, Vishal LPG, which is challenging the government’s demand for a net present value over forest area, has been granted a personal hearing in the coming days. Sociedade de Fomento which bid highest for the other Nadidih (BICO) block has a High Court order restraining the state from taking any coercive action against its delay to sign a lease.
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