The Comptroller and Auditor General (CAG) has flagged violations of environmental clearance (EC) conditions at two coal mines operated by Mahanadi Coalfields in Odisha. The compliance audit for the year ended March 2024 found excess or unauthorised production of nearly 11.8 mn tonnes of coal.

The audit assessed the potential recoverable amount under the Mines and Minerals (Development and Regulation) Act, 1957, at Rs. 9.76 bn. The findings relate to the Kalinga Open Cast Project in Talcher and the Kulda Open Cast Project in Rourkela, where production exceeded applicable EC conditions or limits.

At the Kalinga project, the EC expired on October 23, 2021, after accounting for extensions granted during the Covid period. Despite the expiry, mining continued until March 2023, resulting in the extraction of approximately 11.5 mn tonnes of coal without a valid clearance. The value of this production was assessed at Rs. 9.57 bn.

The audit also identified excess production at the Kulda project. Although its annual EC limit was raised to 21 mn tonnes in May 2022, the permissible output for 2022-23, calculated on a pro-rata basis, was 20.77 mn tonnes. The mine produced 21 mn tonnes during the period, exceeding the applicable limit by 230,000 tonnes, with the excess valued at Rs. 190.2 mn.

The CAG criticised mining authorities for inadequate verification of EC validity and permitted production limits. The audit findings indicate that stronger monitoring was required to ensure that operations remained within the conditions approved by environmental authorities and to identify recoverable dues promptly. The report has put the compliance practices at both mines under scrutiny, particularly in relation to continued production after clearance expiry and output beyond authorised thresholds.