The government on Thursday announced that it would auction eight coal blocks from schedule III mines — which require up to a year to start production — for non-regulated sectors like iron and steel, cement and captive power plants.
The fourth round of coal auction will take place against the backdrop of rising domestic production
enabled by Coal India’s much-improved production growth over the last 18 months. However, production from captive mines has halved to 15 million tonnes (mt) in the April-October period compared with last year owing to a delay in acquiring state-level clearances by new mine operators.
Coal sector experts said the production from majority of the operating mines has not started as fresh clearances, in the domain of state governments, are yet to come for operators that bagged them in the first two rounds of auction.
Fuel for growth
* 8 mines earmarked for fourth-round of auction for non-regulated sector
* Sectors like iron & steel, sponge iron and cement etc will vie for blocks
* Mines located in Jharkhand, Maharashtra, West Bengal and Madhya Pradesh
* They have a peak production capacity nearly 13 million tonnes per year
The central government had hoped for a faster transfer of state-level clearances in the transition period between existing and new operators.
Coal secretary Anil Swarup said that most of schedule II mines are likely to start production “in the next two to three months” as all issues including necessary clearances, stamp duty, handing over of assets, etc, have “fortunately been resolved with the intervention of the prime minister who himself reviewed the projects”.
The coal blocks to go under the hammer in January include Brahmapuri and Suliyari in Madhya Pradesh, Bundu and Gondulpura in Jharkhand, Gondkhari and Khappa & Extension in Maharashtra, and Jaganathpur A and Jaganathpur B in West Bengal.
These mines together have reserves totalling 1,143.42 mt and their peak rated capacity stands at 12.86 mt. Out of the 204 coal blocks cancelled by the Supreme Court last year, the government has managed to dispose of more than 100 mines through a combination of competitive bids for private players and allocation for public sector units.
The third round of coal auction held earlier this year saw lack of interest from bidders as several mines were taken out of the process due to lack of the mandatory three technically qualified candidates for half of the 10 identified mines. Some of these mines had been carried
forward from the earlier round after having been cold-shouldered by bidders even then.