Centre puts up eight coal mines from four states for auction

The central government on Thursday said it has decided to auction eight Schedule III coal mines earmarked for the non-regulated sector in the fourth tranche of the coal auctions in January next year.

Two mines each from Madhya Pradesh, Jharkhand, Maharashtra and West Bengal will go under the hammer when companies from the iron and steel, cement and captive power plants will bid for a total 1,143.42 million tonnes (MT) of coal reserves.

The Brahampuri and the partially explored Suliyari coal block in Madhya Pradesh has coal reserves of 102.49 MT and 142 MT, respectively, while the Gondkhari and Khappa coal mines in Maharashtra has reserves of 98.72 MT and 84.72 MT of the fossil fuel.

Bundu and Gondulpara coal blocks in Jharkhand each have reserves of 102.27 MT and 176.33 MT, respectively.

The largest of the allotted mines (at 267.33 MT) is in the Jaganathpur coal block in West Bengal where two of the blocks (to go for auctions) have a joint reserve of 436.9 MT.

"Directions have been issued to the nominated authority for conduct of the auctions," a statement from the government said.

In a press conference, Coal Secretary Anil Swarup said the Notice Inviting Tender will be issued on Friday (November 20) while the commencement of the sale of tender document shall start from the same day.

The due date for submission of bids has been fixed on December 31 this year and the e-auctions will be held during January 18-22 next year.

"We are hopeful of giving vesting order to the winners by March 2016," Swarup said.

"We have identified coal blocks under the UDAY scheme wherein we would auction coal linkages to the states which commit to the distribution reforms. States would be allotted the coal blocks who can then auction it through tariff based bidding to its power utilities," he said.

"The bidding would be as per the terms of power purchase and efficiency parameters set in the UDAY memorandum," he added.

The results of the bidding will be declared by March 10 next year.

The secretary said currently operational mines are producing around 5 million tonne of coal and 29 more would start production by the next year.

Through the earlier three rounds of auctions, the government has awarded 45 coal mines to both the power and unregulated sectors yielding revenue of Rs.350,000 crore for a period of 30 years for the coal bearing states.

Meanwhile, the government said on Thursday that it will start the auction of minerals by year-end with approximately 70 leases planned for the first phase.

The states are now finalizing the modalities for the mine auction said Minister of State for Steel and Mines Vishnu Deo Sai said in message read out at a industry chamber FICCI conference on the mining industry.