Trouble for community company as SMCL denies extension

Kelzang Wangchuk | Samdrupjongkhar

State Mining Corporation Limited (SMCL) has denied time extension to Pemi Dejung Kuenphen Private Limited (PDKPL) after the company could not procure earthmoving equipment (EMEs) for hire to SMCL within the deadline.

SMCL’s letter to PDKPL on March 24, stated that the corporation had given adequate time to PDKPL since June last year to prepare their proposal at the cost of delays and adverse impact on the SMCL’s performance to meet the targets.

The letter stated that partial fulfilment of conditions would not be acceptable, and SMCL would not be liable in any manner.

The company wrote back to SMCL on March 27. It stated, “Although it’s for positive purpose and long-term business, we would have no choice but to hire EMEs due to the high cost of EMEs, low value of the collateral and less equity collection for shares.”

The letter stated that considering the sustainability and distribution of income, they would be procuring the EMEs phase-wise or, in a year’s time. “This would reduce not only the financial pressure of the community but also benefit those individuals who had invested in EMEs.”

According to the letter, since it’s a community project, some financial institutions are willing to finance without a mortgage, but they require a confirmation letter of the work. “It would not only ease the community in availing the loan but also accelerate in taking the work.”

“We would face severe consequences if the deal is cancelled as we already paid Nu 20M advance to the dealer. We also found it enough time and confidence to take up the work on time as we heard SMCL had extended three months to the present contractor,” the letter stated.

The SMCL would now continue tender formalities for the hiring of EMEs for the two coal mines at Habrang and Tshophangma in Samdrupcholing drungkhag, Samdrupjongkhar.

SMCL’s officials said they are preparing for the open tender for coal mines at Habrang following the board’s directives. The coal mines at Tshophangma would be awarded to the lowest evaluated bidder fulfilling the tender procedures. “Local trucks would be deployed based on individual households.”

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