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  1. States’ promised revenue from coal block auctions crosses Rs 2 lakh crore

States’ promised revenue from coal block auctions crosses Rs 2 lakh crore

Coal-bearing states' promised revenue streams from coal block auctions have crossed Rs 2 lakh crore on Monday...

By: | New Delhi | Updated: March 10, 2015 1:46 PM

Coal-bearing states’ promised revenue streams from coal block auctions have crossed Rs 2 lakh crore on Monday even as only 32 mines have been bid out thus far. The second phase of auction involving schedule III (near-operational) mines, which was not expected to witness aggressive bidding, is all set to rake in over Rs 70,000 crore by Monday for 13 mines, with one more mine in this category left to be bid out on Friday.

Auctioning of 19 producing mines in the first phase that concluded earlier would enrich the respective states by Rs 1.2 lakh crore over 30 years.
On what was scheduled to be the the last day of second phase auctions, Utkal-C mine was bagged by Monnet Power Company at Rs 770/tonne that would fetch Odisha Rs 9537 crore over 30 years. Bidding for the second mine, Lohari block in Jharkhand and earmarked for the unregulated sector, on offer had received Rs 2,108/tonne at the time of going to press.

The third block of Jamkhani, reserved for the unregulated sector, was set to be auctioned on Monday but has been pushed to Friday, owing to directions issued by the Delhi High Court in connection with a petition filed by Bhushan Steel, prior allottee of the block, that has contended that bidding norms were not fair.

Jharkhand and Odisha are likely to receive a total of nearly Rs 30,000 crore each, including royalty, over 30 years from just the second phase of auction. Initially, the second phase was to have 20 mines for auction but 6 mines were taken out as 4 mines failed to receive the requisite number of technically qualified bidders while the Delhi HC had directed the government to review the end-use of one other mine.

Belying expectations of tepid response from bidders owing to the unpreparedness of these mines, the bidding saw the highest bid of Rs 770/tonne for Utkal-C mine, reserved for the power sector, offered by Monnet Power Company. The minimum bid for the block meant for the power sector in schedule II was at Rs 478/tonne. As for the block reserved for the unregulated sector, the highest bid of Rs 2,291/tonne was offered by Ambuja Cements for Gare Palma IV/8 mine in Chhattisgarh. The lowest price for the same category of mine in schedule II auctions was Rs 918/tonne.

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