Allocation of coal mines for Rel Power transparent: Moily

Power Minister Veerappa Moily today said the process of allocation of coal mines for Reliance Power for its Madhya Pradesh project was transparent. He, however, refused to comment on the observations of CAG report which stated that Reliance Power gained Rs 29,000 crore by diverting excess coal from the mines allotted for its Sasan project in the state.

"There is no illegality in coal block allocation. It is an open book. It is transparent. I am not part of any value judgement at this stage. Ultimately it is a report given by CAG. It is not a final finding. It will go before the Public Accounts Committee. It will go before  Parliament," Moily told reporters.

The minister said the Comptroller and Auditor General of India (CAG) was provided all the information from the Power Ministry.

"CAG was informed of AGI's decision, not that anything was withheld and all the relevant papers were placed before the CAG, and they should have considered it. They have not referred to the Attorney General of India's (AGI) opinion. CAG has not taken cognisance of all these relevant facts in its final report", he said.

CAG in its report tabled in Parliament said subsequent to award of the 4,000 MW Sasan ultra mega power project to Reliance Power, the government granted permission to the company to utilise the surplus coal from three mines attached to the projects for the company's another project at Chitrangi in Madhya Pradesh.

CAG said the permission to use excess coal from Moher, Moher Amlohri and Chhatrasal blocks allocated to Reliance Power's Sasan power project after its award "not only vitiated the bidding process but also resulted in undue benefit to the company".

CAG also said it was not clear how Power Ministry in October 2006 came to the conclusion that two initially allocated blocks for the Sasan project (Moher and Moher Amlohri) would be inadequate for the project.

Reliance Power bagged this project in August 2007 by quoting the lowest tariff in the international competitive bidding conducted by Power Finance Corporation, the nodal agency for UMPPs.