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Nalco in the national auditor’s firing line

26th July 2019

By: Ajoy K Das

Creamer Media Correspondent

     

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KOLKATA (miningweekly.com) – Indian State-run National Aluminium Company Limited (Nalco) has been hauled up by the national auditor Comptroller and Auditor General (CAG) for a delay in developing captive coal blocks allocated to it, which resulted in a potential loss of revenue.

In its report submitted to Parliament on Wednesday, the CAG noted that the company had lost potential revenue of about $157-million from producing about 493 000 t of metal less than during the period 2012/13 to 2016/17, largely owing to its failure to develop Utkal E coal block, which was allocated to Nalco in 2014.

The coal block had been allocated to the State-run metal refiner under a preferential allotment dispensation to meet the higher requirement for dry fuel from captive thermal power plant, which had expanded during the time from 960 MW to 1 200 MW.

CAG noted that not only did Nalco fail to develop the captive coal block Utkal E allocated to it, a new block Utkal D allotted to it failed to be operationalised, owing to delays in finalising mining plans and the appointment of a mine developer operator (MDO).

Nalco has also come into criticism for coal consumption, with the auditor noting that the company used excess fuel at its thermal power plant, owing to the high heat rate and failure to detect slippages in quality standards of coal supplied.

On mining and metal refining, CAG in its report said that, during the period under review, Nalco had produced 9.631-million tons of alumina, primarily owing to lower bauxite production than the targeted 10.74-million tons.

The company was also flayed for failure to comply with environmental norms and deviation from standards, with CAG citing as an example Nalco’s daily discharge of red mud and red mud pond effluents being consistently higher than limits laid down by the State pollution control regulator.

 

Edited by Creamer Media Reporter

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