Coal supply contracts awarded by Tamilnadu electricity board

Tamilnadu Generation and Distribution Corporation ltd (TANGEDCO) is a subsidiary of Tamilnadu Electricity Board (TNEB). The documents available on TANGEDCO’s website says the following about the coal purchase agreements in one of the two coalfields allotted to it:

TANGEDCO had been allotted Gare Pelma Sector II coal block in Raigarh District of the State of Chhattisgarh along with Maharastra State Mining Corporation by Ministry of Coal, GOI on 02.08.06. The Joint venture company “Mahatamil Collieries Ltd” (MTCL) has been formed on 28.08.09 for development of Gare pelma sector II coal block… It has been proposed to install a pithead power station utilizing TANGEDCO’s share of coal received from this mine. The Letter of Award (LOA) has been issued to M/s.Lanco Infratech Ltd as Mine Developer and Operator (MDO) for Gare pelma sector II coal block on 03.08.11 and MDO has to develop a pit head power station (ie. a power plant at the site of mine itself) using the share of TANGEDCO coal.

TNEB also imports a large chunk of coal from Indonesia. During DMK’s rule, ADMK was vocal about a huge scam in this coal import contract, but has become quiet after she became CM. More on Jayalalitha’s allegations here: 1, 2 and DMK’s reaction here: 3

Who is Lanco Infratech?
Group website:
Lanco was founded by the Indian National Congress politician Lagadapati Rajagopal, who is currently a member of 15th Lok Sabha representing Vijayawada. While Rajagopal remains the chairman, his brother Lagadapati Madhusudan Rao is the executive chairman. Another brother Sridhar Lagadapati, was involved with the company in the early years, but now heads the related entertainment business, Larsco. Lanco has grown at a tremendous pace since the early 1990s, after Rajagopal married the daughter of veteran Congress leader P. Upendra, and joined politics himself.

Tender process:
The tender was floated by “Mahatamil Collieries Ltd” (MTCL). The bids were opened in December 2010. Note that TN government changed from DMK to ADMK in April 2011. And from the TANGENDCO document above, LANCO was awarded the contract letter in August 2011. Also, as per the tender norms (see sr. no. 13 of the amendments doc), TNEB will have rights over 50% of power and the rest can be sold in open-market by LANCO.
Details of the final contract here.

How about an RTI?

Some media articles:

  • Maharashtra, TN violated coal ministry norms by auctioning block
  • Jindal may block Lanco project
  • About Gu'an

    Blog: iamamangoman DOT wordpress DOT com
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