New Delhi: State-owned CIL has written a letter to the coal ministry stating its decision to opt out of ICVL, a special purpose vehicle formed to acquire coal mines overseas, a company official said on Thursday in New Delhi.
“CIL board in its meeting held on Monday decided to write to coal ministry on 29 May on its decision to opt out of ICVL consortium,” the official added.
ICVL, a joint venture between SAIL, CIL, NTPC and NMDC, was incorporated in 2009. It was conceptualised by the steel ministry for securing much-needed coking coal and thermal coal assets in overseas territories.
According to sources,the coal ministry on receiving the letter from CIL will make recommendations to the steel ministry and seek its permission to CIL’s exit from ICVL.
Sources had said that CIL board had agreed to walk out of ICVL. The board felt that it was not advantageous for the PSU to be part of the consortium, they said, adding that the venture on the part of CIL involved financial burden without commensurate advantage.
NTPC had also expressed its willingness to opt out of t he consortium.
SAIL and CIL each holds 28% stake and RINL, NMDC and NTPC 14% each in ICVL.
ICVL, which has Rs 10,000 crore authorised capital and Rs 3,500 crore equity capital, has not been able to taste success since its formation.
The consortium aims to be the owner of about 500 million tonnes (MT) of met coal reserves by 2019-20.