Pending Mining Approval Stalls Sarda Energy's Kolam Project in India

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Researched by Industrial Info Resources India (Delhi, India)--Mining company Sarda Energy & Minerals Private Limited's (BSE:504614) (SEML) (Raipur, Chhattsigarh) 350-megawatt (MW), coal-fired power project in Raigarh has now been held up for more than a year as the company awaits approval from the Indian Ministry of Coal for the enhancement of production from its captive coal mines.

The company already has acquired environmental clearance from the Ministry of Environment and Forests for the project at Kolam. SEML is also in possession of the land needed for the project. The company operates a captive mine at Karwahi village in the Mand area of Raigarh Coalfield, located in the Raigarh district of Chhattisgarh.

At present, the coal available from the mine is utilized for the production of sponge iron at Siltara. The sponge iron plant requires about 1.1 million tons per annum of coal to meet its fuel needs. The company is proposing to expand the production capacity of the coal mine by mining underground. The surplus coal available from the mine will be utilized to feed the proposed 350-MW power plant, the coal requirement for which has been estimated at 3.6 million tons per annum. SEML has thus sought clearance from the coal ministry to enhance production by another 2.4 million tons per annum.

The power plant was initially conceived with a capacity of 300 MW, comprising two units of 150 MW each. SEML had invited bids for boiler, turbine and generator packages and received a total of 11 bids. However, the company may now re-invite bids for both the main plant and balance of plant packages for the revised 350-MW capacity.

SEML is one of the major producers of sponge iron, billets, ingots and TMT bars. It is one of the largest manufacturers and exporters of ferroalloys in India. The company merged with Chhattisgarh Electricity Company Limited (Raipur, Chhattisgarh) in 2007 to venture into the other verticals in the energy sector.

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