World?s largest coal producer, Coal India Ltd, has invited exploration and production companies to invest in converting the deepest coal deposits in Madhya Pradesh and Bihar into gas as the government seeks to generate clean energy from difficult-to-mine coal fields.
Coal India?s subsidiary and Bihar-based mini-ratna firm Central Mine Planning and Design Institute has invited companies to bid for the Kaitha block at Ramgarh coal field in Bihar and the Thesgora c block at the Pench Kanhan coal field in Madhya Pradesh for underground gasification, said an official. Bidders should have a net worth of more than Rs 200 crore.
Coal India wants to give a major push to gasifying coal deposits underground in line with the government?s plan to promote alternative sources of energy and clean coal technologies. More coal blocks are expected to go under the hammer for gasification, said the official.
Blocks will be awarded to those who offer the highest production level payment to Coal India over and above a floor that will be set at the time of auction. Private players who get licence for coal gasification are free to exit these blocks if pilot studies indicate that gasification may not be viable there.
Coal India produces over 40 crore tonne of coal a year but conventional mining is not possible from coal deposits deeper than 300 metres. Converting such deposits into gas underground and extracting in gaseous form would be economically attractive and environment friendly. This technology can also be used for exploration in small isolated patches of coal fields. Coal gasification has been set as a priority area for alternate sources of energy by the government?s integrated energy policy too. The government has also allowed gasification of coal as one of the end uses of coal mining for captive use.
As per official estimates, the country is expected to require about 731 million tonne of coal by the next financial year, which is a 54% increase over what was required in 2006-07. Coal bed methane (CBM), another clean fuel, is also being exploited to meet the increased energy requirements. A panel of secretaries is now finalising the award of CBM blocks under the latest auction.