CIL begins process of developing Rs 2,474 cr CBM projects

State-owned CIL has initiated the process of development of coal bed methane projects with an estimated investment of Rs 2,474 crore, and has invited domestic as well as global firms for exploration of the blocks in West Bengal and Jharkhand.

The PSU will develop both projects on revenue sharing basis.

Coal India Ltd (CIL) arm Bharat Coking Coal Limited (BCCL), "announces the offer of Jharia CBM Block-I for exploration, development and marketing of CBM through Coalbed Methane Developer (CBMD) (the contractor)," the maharatna firm said.

Eastern Coalfields Ltd (ECL) has offered Raniganj CBM Block for exploration, it added.

Companies are invited to bid for exploration, development, production, marketing of the blocks, the company said.

While the investment for Jharia (Jharkhand) CBM project is estimated at Rs 1,879 crore, Raniganj (West Bengal) project estimated at Rs 595 crore.

Both the projects have an estimated CBM reserves of 27.42 billion cubic metre.

CBM is a form of natural gas trapped in coal seams underground, which can be extracted by drilling into the seam.

CIL arm CMPDI has been been appointed as a principal implementing agency (PIA) for BCCL and ECL to facilitate the development and extraction of coal bed methane (CBM).

The development of both the projects will be under three phases. The phase one will be that of exploration.

Under second phase pilot assessment and market survey will happen. The third phase pertains to development and production.

"As part of the bidding documents, the PIA on behalf of the Lessee has provided a revenue sharing contract (RSC) agreement which sets forth the detailed terms and conditions of the Project, including the development of the CBM project, operation and maintenance of the CBM project, extraction, delivery and marketing of CBM extracted and rights and obligations of the CBMD," the company said.

The Centre has taken various initiatives to enhance extraction of CBM with an objective to optimise clean energy resource.

Methane emitted from coal mining operations is one of the significant source of green house gas causing adverse impact on the environment.

There are numerous benefits to capturing and using CBM, including reducing greenhouse gas emissions, conserving a local source of valuable, clean-burning energy, enhancing mine safety by reducing in-mine concentrations of methane and providing revenue to the mine.

Methane has also an energy value and is an important constituent of natural gas.

Coal India accounts for over 80 per cent of domestic coal output.