CIL to invite bids this month for drilling Mozambique blocks

State-run Coal India (CIL) will float bids this month to hire an agency for exploratory drilling of its two coal blocks in Mozambique to assess the reserves estimated to be at about one billion tonne.

The exploratory drilling of the twin blocks is likely to begin in May 2011 while the production is set to begin by 2015.

"The tender to hire an agency for regional drilling to find out coal reserves of the twin blocks will be floated this month," said an official on the condition of anonymity.

The Navratna firm has already handed over the programme for drilling to Mozambique government last month.

"The detailed programme for the drilling was handed over to the Mozambique Government in January when a Coal Ministry delegation, headed by Coal Minister Sriprakash Jaiswal, went there," the official said.

Consequent to the preliminary drilling, detailed exploration will follow in May 2012 to quantify the actual reserve, besides assessing geological disturbances, the official added.

The mining plan of both the blocks will be drawn in 2013 and production from these blocks will begin in late 2014 or early 2015, he said.

CIL had won the twin blocks in August 2009 through a global tender floated by the government of Mozambique.

Coal Minister Sriprakash Jaiswal said last month that India was seeking infrastructural support from Mozambique Government to make Coal India's twin blocks operational and the African nation in turn had assured India to extend its full cooperation.

India has requested Mozambique to construct a bridge over river Dcondezi, which falls between the coal blocks, besides building a port to facilitate geological prospecting and exploration and later transportation of coal.

Coal India, which accounts for over 80% of the domestic production, is scouting for coal properties abroad to bridge the widening demand-supply gap estimated at 82 million tonnes. This is expected to soar to 142 million tonnes in 2011-12.

The state-run PSU produced 431.5 million tonnes coal in the last fiscal and has a target of about 460 million tonnes production for the current fiscal.