Andhra Pradesh

‘No irregularities in awarding sand mining contract to JPVL’

Denying that the sand mining contract awarded to Jaiprakash Power Ventures Limited (JPVL) was fraught with irregularities, Principal Secretary (Mining) Gopal Krishna Dwivedi asserted that Metal Scrap Trade Corporation Limited (MSTC) has done due diligence in accordance with the guidelines laid down by the State government and the eligibility and track record of JPVL were thoroughly verified.

Addressing reporters on Monday, Mr. Dwivedi said the sand policy came into force on September 5, 2019, and it has been evaluated through an effective process of collecting feedback and a Cabinet committee has made certain recommendations after several rounds of deliberations were held at the highest level on delivery cost and various other issues.

The government then prescribed a comprehensive set of guidelines right from the minimum annual turnover of the prospective bidders to the minimum experience required and the need for proven track records.

One of the clauses in the tender document clearly stated that the company’s net worth as on March 31 should at least be ₹152 crore for the first package and ₹238 crore and ₹95 crore for the second and the third packages respectively. So, the allegation that JPVL is bankrupt was baseless, he said.

Another clause said the company should have completed similar works in the last five years apart from possessing the minimum equipment necessary for executing such contacts. This was looked into by the MSTC, he added.

Besides, the government would be holding ₹120 crore as bid security. On an average, the State required two crore metric tonnes of sand and with the price capped at ₹475 per tonne, the total value of the contract is not more than ₹950 crore, of which JPVL has to pay ₹765 crore to the government, he clarified.

The operational cost per tonne works out to ₹64. The company would, therefore, be earning around ₹72 crore. Multiple penalty clauses were incorporated in the tender document.

Mr. Dwivedi further said JPVL has to pay to the government every 15 days in advance for the next 15 days of business operations. Of the ₹475 per metric tonne price at the sand reaches, ₹375 goes directly to the government treasury.

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Printable version | Jun 12, 2021 11:07:06 PM |

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