Bhubaneswar, Oct. 7: The state government has suggested to the Centre that the coal-bearing areas should be allocated only to government companies under the control of host states.

“Coal required by the industries located outside the state can be met by the host state government companies,” said the state government. However, it said priority in the matter of allotment of coal blocks had to be those industries to be set up in the host states. The suggestion was made in response to the Centre’s queries on the terms and conditions for allocation of areas containing coal.

The state government also wants the committee to be constituted by the Union coal ministry to decide on such matters to include representatives from the governments of the host states. “The committee should take into consideration the views of the state government. In case the state government’s views are not acceptable, the reasons for rejection should be cited,” the government’s response noted.

While the state government now bats for transparency on the allocation of coal blocks, senior BJP leader Bijay Mohapatra today demanded an immediate CBI inquiry into the scam involving the joint venture between Sainik Mining and Allied Service Limited and the Odisha Mining Corporation.

In a letter to chief minister Naveen Patnaik, Mohapatra said: “The entire decision to enter into a joint venture with the Sainik Mining was taken by you. If you are innocent, the government should have recommended a CBI investigation in terms of sections 5 and 6 of the Delhi Special Police Establishment Act, 1946.” Last month, the government had scrapped the corporation’s coal deal with the Sainik Mining.

In another development, the state government in its letter has pointed out that the area containing coal for allocation to government companies should be identified keeping in mind its size to ensure that it has sufficient and good-quality coal reserves to set up high-capacity coal projects with world-class technology standards.

The state government said there should be four categories of plants to be considered for supply of coal from such blocks and the state government should decide on the mechanism of allotment based on different parameters. The utility power plants of the state or central government companies and independent power producers with long-term agreements with power distribution companies and the Grid Corporation of Odisha (Gridco) should be considered for assured coal supply. The end users in steel, cement and captive power plants would get coal at prices to the notified separately.

The non-specified end users and merchant power plants, which do not have any long-term power purchase agreements, may be given coal supply through e-auction process, but priority should be given to the industries located within the host states.

While the Centre would take time to consider the state government’s suggestions, in another development, the steel and mines department today asked the mining directorate to ensure that applications for the renewal of mining lease were filed at least 12 months before its expiry. The department is supposed to deal with the application within six months of receipt. “An application for the renewal of a mining lease shall be disposed of within period of six months from the date of its receipt,” said steel and mines secretary Rajesh Verma in a letter to the director of mines Deepak Mohanty.

If an application is not disposed of within the specified period, it shall be deemed to have been refused. The move aims to cap the controversy over continuance of mining by lessees even after the expiry of the leases taking advantage of the deemed extension clause, which allows them to continue operations if the state government fails to take a decision on their applications within a specified timeframe.

The state government has also asked the director of mines to identify cases of mining under the deemed extension clause and put an immediate halt to their operations.

The director has also been directed to submit within a fortnight details of cases of the renewal of mining leases having been refused during 1987 to 1994 and where the renewal applications were not filed at least 12 months before the expiry date. The director would also furnish details of cases where prior approval of the Centre was not obtained for renewing the leases as was required before December 20, 1999.