Ranchi, May 20: An eagerly anticipated opinion of the attorney general has boomeranged on the Arjun Munda government, which was hoping to wrest control over the contentious coal block of Banhardih in Latehar by teaming up a private player of its choice with the state electricity board for mining explorations.

Attorney general Goolam E. Vahanvati has endorsed a joint venture between the Jharkhand State Electricity Board (JSEB) and the Bengal EMTA Coal Mines Limited (BEMCL), which had challenged the government’s bid to look for other companies citing an agreement with the power board in 2003.

However, the Munda regime was not in favour of joining hands with BEMCL, which had entered into an MoU with the then Babulal Marandi government for mining rights in Banhardih. The government was not convinced with the legal sanctity of the 2003 agreement — it allowed mining rights for BEMCL with a majority stake of 74 per cent — and suspected the private company was being unduly favoured.

Vahanvati has argued that the government should not go ahead with its plans of engaging other players for mining, considering the state had already entered into an agreement with BEMCL in 2003.

“We have received the attorney general’s legal opinion. The state government has no other option but carry out mining activities in the coal block allotted to JSEB with the EMTA Group,” Arjun Munda told The Telegraph.

Sources said the state energy department was now considering opting for a 51:49 stake in favour of the government after forming a joint venture company with the Bengal-based group.

Meanwhile, the Union coal ministry also came out with a press statement earlier this month, claiming they have cancelled the allocation of Banhardih block to JSEB, complaining about inordinate delay in developing the coal reserves spread over 10-12sq km.

“We are yet to receive a written order of the coal ministry on cancellation of the Banhardih coal block. The statement has appeared only in a section of media. Whatever the circumstances are, we will strongly protest any such move and may even approach the court of law,” state energy secretary S.K. Satpathy said.

Satpathy claimed the delay was on the part of the Central Mine Planning and Design Institute, a CIL subsidiary, which refused to prepare a mining/geological report that could pave the way for mining activities on the coal block. “We later turned to the mines and geology department for the task, which is nearing completion,” he added.

The Munda government sought Vahanvati’s opinion on the Banhardih block — allotted to JSEB in 2006 for its captive use to produce electricity through the Patratu Thermal Power Project (PTPS) — after BEMCL opposed its move to rope in other players via open tenders in an apparent bid for greater transparency.

Satpathy added that a prospective power company would be chosen through open bidding for a proposed 1,320-1,980MW power plant in Patratu, Ramgarh, to be set up on a public-private partnership model.

The government had earlier considered allowing the chosen company to take up mining in Banhardih after statutory clearances. But, the attorney general’s opinion has upset its plans.

On April 27, 2010, as many as 35 companies had pitched for the proposed Patratu power plant, encouraged by the fact that sourcing coal would not be a problem since the Banhardih block had been allotted to JSEB. But, the state government failed to launch the project in view of BEMCL’s opposition.

The EMTA Group is not new to Jharkhand. Since 2006, it has been engaged in mining activities at Pachwara (central) coal block in Pakur district for PANEM Coal Mines Limited — a joint venture between Punjab State Electricity Board (PSEB) and BEMCL.