Odisha govt scraps bidding process for 20 mines

Identifying errors in its earlier notices for auction of 20 iron ore and manganese mines, Odisha government has decided to annul a previous bidding process and go for a fresh one, an official said here on Tuesday.

The Department of Steel and Mines asked the Director of Mines in a letter on Monday that it would initiate a fresh process for the auction of the 20 mineral blocks.

"We will go for fresh auction process under a single Notice Inviting Tender (NIT), which will be initiated immediately in respect of 20 leases expiring on March 31, 2020. Those were covered under the annulled tender notices dated October 4 and 14 respectively," the official said.

The state government had earlier issued notices for auctioning of 29 iron ore and manganese mines, leases of which are scheduled to expire by the end of March 2020.

However, fresh notices will be issued for 20 mines as of now, an official said adding that the mistake was found during the technical bidding.

The Directorate of Mines had received bids from 177 companies for the auction of 20 mining blocks.

"It was detected that apart from subsidiary companies, the holding companies had also applied for the bidding in gross violation of the Mining Tender Act," Director of Mines Dipak Mohanty said.

Taking note of this unfair bidding, the government felt that a fair auction process could not be ensured as the price and premium discovery couldn't be determined, he said.

This is the reason for the government deciding to cancel the auction notice and issue a fresh notification by incorporating new conditions in the tender document, he said.

"The government will issue a fresh notification on December 6 while the tender process will be completed by March 31 next year," he pointed out.

The Department of Steel and Mines through a letter has directed the Director of Mines to initiate a fresh process for the auction of the 20 mineral blocks.

The auction process for mineral blocks notified under another annulled NIT dated October 18 will be scheduled subsequently, the letter said.

The decision was taken on the basis of discussions held in the recent meetings of the Technical Evaluation Committee(TEC) and the High Level Committee(HLC).

It was also decided to return the bank guarantees furnished by the bidders in response to the annulled NITs.

The reservation of mineral blocks for end use, including the definition of end use and Reserve Prices as approved earlier, shall be retained as such in this fresh auction, he said.

The new time schedule for auction of the 20 blocks as finalized in consultation with the Transaction Advisor (TA), has been intimated to the Director of Mines.

The letter of intent will be provided to the successful bidder between February 10 and 29, the official said.

The opposition BJP and Congress, however, criticised the state government for withdrawing the auction notice in the middle of the bidding process.

"They might be doing this knowingly to favour any company. Why cannot the government prepare a faultless auction notice?" asked OPCC president Niranjan Patnaik.

BJP general secretary P Harichandan said, "There is a smell of corruption in the bidding process."

Steel and Mines Minister Prafulla Mallick, however, said, "Where is corruption when the mines have not been auctioned at all? There should be a logic behind any allegation.