CIL finds no merit in Steel Min’s proposal to auction BCCL mines

Feb 19 2013, 01:57 IST
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SummaryThe steel ministry has called for the auctioning of all unused coking coal mines in the country to steel makers in view of the paucity of the fuel, triggering sharp reactions from Coal India Ltd

The steel ministry has called for the auctioning of all unused coking coal mines in the country to steel makers in view of the paucity of the fuel, triggering sharp reactions from Coal India Ltd.

In its revised draft National Steel Policy 2012, the steel ministry has proposed that Bharat Coking Coal Ltd, which is the custodian and operator of coking coal mines, should be de-merged from parent firm CIL and its idle mines should be offered to home-grown integrated steel plants for commercial exploitation, with suitable terms and conditions.

At present, BCCL operates 81 coal mines, including 40 underground, 18 open cast and 23 mixed mines. It has registered over 30 million tonne of coal production and has targeted nearly 40 MT by the end of the twelfth plan period. The company, which is a subsidiary of CIL, was declared sick in 2009.

Both the coal ministry and CIL see “no merit” in the steel ministry’s proposal, claiming, instead, that steel PSUs like SAIL or Rashtriya Ispat Nigam Ltd or even their private counterparts do not have the technological wherewithal to operate underground mines.

“How does the de-merger help the steel firms? Do they have the technological strength for operating these mines, especially the underground ones, most of which are in the BCCL zone? They do not mind spending crores of rupees for importing coking coal, but shy away from investing money to set up washeries back home,” CIL chairman S Narsing Rao told The Indian Express.

BCCL CMD Tapas Kumar Lahiry said his company has a target to produce nearly 40 MT by 2016-17, which it further plans to increase to nearly 50 MT by 2019-20. “First of all we do not have any idle coking coal mine. There is no credible reason to keep any mine idle if it can be made operational for production. Where is the question of BCCL having idle mines? he asked.

“We have told these steel companies a number of times to invest in washeries because they need washed coal, but they have not ventured ahead. We are already operating two washeries and the third is slated to operate soon. We are trying our best within our limitations,” Lahiry said.

He said it is because of the apathy of steel companies that the coal ministry had earlier warned of auctioning their contracted coal, which are lying at the pitheads.

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