Kollam: A project involving the processing of monazite, a strategic mineral with applications in nuclear energy and defence sectors, has run into controversy following allegations that tender conditions were tweaked to favour a Hyderabad-based private company.
The alleged modifications were made in the final phase of the second Pinarayi Vijayan government amid high-level interventions. The Hyderabad-based company, which is engaged in beach sand mining, processing and export activities in Telangana, was selected for a project to process the monazite stockpile of Kerala Minerals and Metals Ltd (KMML), Chavara and extract valuable elements such as neodymium, thorium and scandium.
The private company was described as a key member of a consortium comprising central public sector undertakings. However, the state government has not disclosed the details of the companies that are part of the consortium.
Under the agreement, KMML was required to provide the company with two acres of land on a free lease for setting up a pilot plant for monazite processing. The company was also to be supplied 50 tonnes of monazite free of cost, with provisions for additional quantities if required. The terms also included providing office facilities, electricity and water for the plant.
Though the agreement stipulated that the two-acre plot would be returned on completion of the project, allegations have emerged that subsequent changes to the tender conditions could allow the private company to maintain a longer association with KMML.
The original tender document stated that if the pilot project proved successful and KMML decided to undertake commercial-scale monazite processing through a joint venture, preference could be given to the company awarded the contract. The Hyderabad-based company, however, sought a modification to the clause, insisting that it should be given preference if KMML moved ahead with commercial production through a joint venture after the successful completion of the pilot project.
When the matter was placed before the KMML Board of Directors, the board clarified that a commitment to grant preference at that stage could not be made. The board, at the same time, also decided that the possibility of giving the company preference in any future project could be considered later and that a right of first refusal could be incorporated into the memorandum of understanding after further discussions.
