Reliance Cement bags block in MP in first coal mine auction

The maiden auction of coal mines got under way today, with Anil Ambani-led Reliance Cement bagging the first mine through e-bidding for Rs 798 crore.

Reliance Cement beat Hindustan Zinc Ltd (HZL) and OCL Iron & Steel to bag the Sial Ghoghri coal mine in Chhidwara district of Madhya Pradesh, a top official said.

The mine has total reserves of 29.38 million tonnes and a extractable reserves of 5.69 million tonnes.

The company bid Rs 1,402 per tonne to get the mine. The block was alloted to Prism Cement earlier. The mine is earmarked for the non-power sector.

The auction for another coal mine (Talabira 1) in Odisha for the power sector was continuing at 1700 hrs.

After the Supreme Court allocation of 204 mines in September, the government decided to auction the blocks. It is putting up 19 blocks on sale in the first tranche.

Coal and Power Minister Piyush Goyal told reporters that money which the government will get from the auction will be utilised for the development of the states, specially eastern states.

After clearing the technical bidding stage, entities from Reliance, Adani, Essar, GMR, Vedanta and Aditya Birla groups became eligible to bid or two blocks -- one in Odisha and the other one in Madhya Pradesh.

Coal Secretary Anil Swarup termed today's bidding as aggressive and said that "it is good for the government (states) as it would fetch good revenue".

The five bidders which are technically qualified for the Talabira mine are Adani Power, Essar Power M P Ltd, GMR Chhattisgarh Energy Ltd, OPG Power Generation Pvt Ltd and Sesa Sterlite Ltd.