Commercial auctioning of coal blocks to re-start from on June 21

Coal ministry has advised all stakeholders to work hard and to achieve at least 175 Mt coal production during this year from captive/commercial coal blocks, showing growth of 19%

Commercial Auctioning of Coal Mines

New Delhi: Union coal minister G Kishan Reddy will launch the 10th round of commercial auction of coal mines on June 21. A total of 61 coal blocks across 8 coal bearing states, including Bihar and Jharkhand will be put on the auctioning in Hyderabad.

So far, ministry of coal (MoC) has allocated/ auctioned 161 coal mines with peak rated capacity of 575 MT. Out of which 58 mines have received mine opening permission and 54 mines are into operation. Last year these mines have produced total of 147 MT of coal, which constitutes 15% of the total coal production of the country.

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Coal secretary Amrit Lal Meena welcoming new coal minister G Kishan Reddy to the ministry

Three coal blocks in Bihar, 15 in Chattisgarh, six in Jharkhand, 16 in Madhya Pradesh, one in Maharashtra, 17 in Odisha, one in Telangana and three in West Bengal will be on the offer for private parties during the 10th round of commercial auctioning, said a senior officer of the coal ministry.

With a view to setting tone for faster pace for coal block auction and operationalization, the minister on Wednesday held a meeting with senior officers of the ministry and reviewed the management of captive and commercial coal blocks. He had stressed upon close coordination with all the stakeholders including state governments and ministry of environment, forest and climate change (MoEFCC) for early resolution of the issues to ensure faster clearance so as to operationalize the allotted coal blocks in least possible time.

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Reddy further directed that the detailed exploration should be carried out on the faster pace, more and more blocks should be offered in the subsequent rounds of auctions, so that more and more investors participate. It is highlighted that in coal block auctions the technical eligibility does not require any prior experience of coal mining. Any company who has financial strength can participate, as the coal mines are now being auctioned for the purpose of sale of coal, which is without end use restriction. Any investor can participate in the coal mine auctions and coal produced in such mining is free to be sold in the open market for any purpose including for export.

Highlighting the need for higher production of coal to reduce imports so as to achieve ‘Aatmanirbharta in coal’, the minister directed that necessary institutional strengthening may be supported at state level. “All coal block allottees should be facilitated on regular basis so that coal mines can be operationalized at the earliest,” he stressed.

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During the meeting, MoC officials informed the minister that the captive/commercial coal miners are primarily large sized consumers including NTPC, West Bengal Power Development Corporation Limited (WBPDCL), Punjab State Power Corporation Limited (PSPCL), Karnataka Power Corporation Limited (KPCL), Vedanta, Hindalco, Adani, etc. Therefore, higher production by these companies would ease out pressure on the demand of coal from CIL which will have cascading effect on the Auction prices of coal, officials said.

With higher production from captive/commercial coal blocks, the premium on auction will come down. Therefore, coal would be made available at cheaper rates to the different consumers in the country. This will help in checking the inflation as coal is the primary source of energy not only for power but all other sectors including steel, fertilizers, aluminum, cement, paper, sponge iron etc.

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Aligning with the vision of Prime Minister Narendra Modi to achieve energy independence by 2047 and Aatmanirbharta in coal, the coal minister has advised all stakeholders to work hard and to achieve at least 175 Mt coal production during this year from the captive/commercial coal blocks showing a growth of 19 %.

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