Metals & Mining News

Hindustan Copper erred in awarding Copper Ore Tailings Beneficiation project: Parliamentary panel



Central public sector undertakings (CPSUs) cannot “be left totally independent in making important decisions involving investments of large scale.” These observations were made in the Parliamentary Committee on Public Undertakings’ report on Unfruitful expenditure towards construction of Copper Ore Tailings Beneficiation Plant relating to Hindustan Copper Limited (HCL).

The committee came down heavily on HCL management for lapses while awarding a Copper Ore Tailings (COT) beneficiation plant to Chennai’s Star Trace Private Limited (STPL).

According to the parliamentary committee, the Rs 280 crore tender was awarded to STPL for using a previously untested new technology to salvage gold, silver, and other precious metals from copper ore byproduct. Eventually STPL never completed the plant.

The tender was awarded basis a pilot project which was also executed by STPL. But despite two extensions and an additional expenditure of Rs 2.06 crore, the pilot project failed to meet its objectives even after 33 months of operation and was deemed unviable on commercial and technical grounds by the performance evaluation committee.

“While accepting the audit observation, HCL management in November 2020, stated that the Company’s decision to build a full-scale COT Beneficiation Plant with a capacity of 3.29 million tonnes per annum (MTPA) without adequately operating the pilot plant was not prudent, which resulted in an unproductive expenditure of Rs. 158.05 crore,” the committee noted.

According to the parliamentary committee, the involvement of high-ranking officials, both serving and retired, has been identified and disciplinary actions with a criminal investigation have been initiated. The Committee also note that some officials are scot-free “due to retirement rules.”The situation underscores the need for stronger internal controls, transparent investigations, and reforms to ensure accountability even postretirement, the committee noted. It also added that change in retirement rules, strengthening internal controls, promoting ethical behaviour, and enhancing oversight mechanisms are necessary.

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