Steel Authority of India (SAIL) is planning to commence work with Lanco Infratech on its Tasra Coking coal project from Sep’17. Tasra coal block which was allotted to SAIL, has geological reserves of approximately 127 MnT and is located in Jharia Coalfield of Dhanbad in Jharkhand.
Lanco Infratech was awarded the Mine Development Operator (MDO) contract through competitive bidding process back in Sep’13, with an agreement to develop the project at a cost of INR 400 Crore within two years.
The project was stalled after the National Company Law Tribunal initiated Corporate Insolvency Resolution Process (CIRP) against Lanco Infratech based on an application filed by IDBI Bank. During the period, the project cost also increased 10 fold to INR 4000 Crore due to changes in the land acquisition laws.
However, SAIL has decided to continue working with Lanco after IDBI bank assurance to provide fund and constructive support to Lanco. The investments in the projects would be made by Lanco which will be later reimbursed by SAIL.
As per the agreement, Lanco would develop the Tasra Open Cast project (OCP) and coking coal washery of 3.5 MnT per annum for SAIL. The development of the project would help SAIL in meeting its coking coal requirements, as the Tasra OCP is planned for a peak production capacity of 4 MnT per annum.
Lanco will also develop and operate a captive power plant of 300 MW for SAIL through a joint venture company (JVC), based on the secondary products arising out of the Washery.
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