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Oracle Coalfields stunned by coal licence cancellation

The Thar coalfield is the hub of Oracle’s plans to build a combined power plant in the region and it said it is taking all steps to have the notification withdrawn.

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Oracle Coalfields (LON:ORCP) has received a shock notification from the provincial government in Sindh, Pakistan that its mining lease over Block VI of the Thar Coalfield has been cancelled.

The Thar coalfield is the hub of Oracle’s plans to build a combined power plant in the region and it said it is taking all steps to have the notification withdrawn.

The decision of the Directorate General of Coal Mines Department is subject to appeal and has been challenged by Oracle under Rule 71 of Sindh Mining Concessions Rules 2002.

The company added that in its view, and in the view of its lawyers, this cancellation is without legal foundation.

Oracle added it remains fully committed to the development of Block VI under the terms of the Mining Lease.

Shahrukh Khan, Oracle’s chief executive, said: "Whilst this is an unexpected and arbitrary decision, on the basis of our substantive and detailed appeal I expect a constructive dialogue with the authorities leading to withdrawal of the notification of the cancellation of the mining lease.

“Oracle remains fully committed to the development of our Block VI of the Thar coal project."

In September, Oracle signed an EPC framework agreement with Chinese contractor SEPCO and is in detailed discussion on the EPC term sheets.

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