Kolkata, Feb 24 (IANS): Citing conflict of interest and objectives, state-owned coal miner Coal India Ltd (CIL) Tuesday said it is withdrawing from a private joint-venture under the central government's ministry of steel.
"This issue of quitting International Coal Ventures Pvt Ltd (ICVPL) has been going on for two-and-half years now. We have our own unit by the name of Coal Videsh to cater to our needs in the international market and the objective of the joint venture was conflicting to our interest... hence, we decided to opt out of it," a senior official from CIL told IANS.
The company earlier Tuesday had informed the stock exchange on this.
"CIL Board, in its meeting held on February 13, directed that CIL should withdraw from International Coal Ventures Pvt Ltd (ICVPL)", the company said in a filing with the National Stock Exchange.
The senior executive from CIL also said that there was an issue of the variety of coal targeted.
"ICVPL is focusing on met and coking coal which is contrary to our objectives", he said.
Coking coal, also known as metallurgical coal, is used to create coke, one of the key irreplaceable inputs for the production of steel.
CIL holds 28 percent share in the firm it may secede from.
When asked about the future of CIL's stake, the official said: "They (ICVPL) have to refund the entire money we have pumped in so far."
"The initial authorized capital of ICVL is upto Rs.10,000 crore ($2 billion-plus). The initial equity capital is Rs.3,500 crore ($700 million) to be contributed by the members progressively based on investment opportunities", the website of ICVPL states.
The private company is a conglomerate between leading state-owned companies aimed at securing metallurgical coal and thermal coal assets in overseas territories and has laid down a goal to own about 500 million tonnes of met coal reserves by 2019-20.
Formed in 2009, the joint-venture includes Navaratna companies like Steel Authority of India Ltd, Coal India Ltd, NTPC Ltd, National Mineral Development Corporation Ltd and Rashtriya Ispat Nigam.
It has also been empowered with autonomy and freedom currently accorded to Navratna companies without formal Navratna status.