Gujarat Mineral Development Corporation Ltd (GMDC) has requested the Centre for a coal block in Chhattisgarh for a proposed thermal power plant in the eastern State.

The request comes as the Environment Ministry is refusing to give the green signal for coal mining in the Morga-II block due to environment issues.

Due to this delay, GMDC's thermal power generation plans are likely to go haywire.

“We are still hopeful of an early decision in this regard,” Mr V.S. Gadhvi, Managing Director, told Business Line today.

He said the Ministry of Coal appeared convinced of GMDC's request but no reply has been received for an alternative coal block.

Nearly five years ago, the listed company, essentially a mining major, was allotted coal blocks in Chhattisgarh (Morga-II) and Orissa (Naini). In 2008, it had planned to set up three power plants in a joint venture to generate 4,500 megawatt using indigenous coal-based thermal power technology in the two coal-rich States. The total investment planned was nearly Rs 20,000 crore.

It was a unique business model in which GMDC would provide assured coal supplies to private parties who would, in turn, ensure supply of a mandated 2,750 MW to Gujarat as its share by 2012.

The Naini coal block had been jointly allotted to GMDC and the Puducherry Industrial Investment Promotion Corporation.

“We have got possession of land there and the Government of India is now carrying out exploration. After its completion, we will apply for environmental clearance for mining coal in this block as well,” said Mr Gadhvi.

Morga-II and Naini have mineable coal reserves of 350 million tonnes (mt) and 250 mt, respectively, spread over 21 sq.km and 10 sq.km areas. “We had planned a joint venture with Hyderabad-based KSK Energy Group at Morga-II, in which the GMDC's share would have been 26 per cent,” the Managing Director said.

According to the plans, the two coal-based plants in Chhattisgarh were expected to generate 2,750 MW from which 1,700 MW would be Gujarat's share. A similar plant in Orissa to generate 1,750 MW would provide 1,050 MW to Gujarat.

For the Naini block joint venture, GMDC was considering joining hands with Gujarat companies such as Adani Power and Torrent Power.

Chhattisgarh and Orissa were to get one-third of thermal power thus generated.

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