In a déjà vu of sorts, Jindal Steel & Power (JSPL) emerged the highest bidder for the Gare Palma-IV/1 coal mine in Chhattisgarh. JSPL quoted 25 per cent premium on the revenue share to the state. The mine belonged to the company before 2014 when a Supreme Court (SC) judgment cancelled all the coal block allocations made over two decades. It achieved the highest production before the SC judgment.
In 2019, JSPL won this mine in an auction held by the Centre for awarding mines for captive/self-use. The bid was cancelled by the Ministry of Coal, citing the bid to be “low”.
For the first time, the Centre is conducting an auction of coal mines for commercial mining and sale to private companies. It amended the Coal Mines (Special Provisions) Act, 2015, in May. The two-part auction commenced last month when companies submitted their technical bids comprising eligibility and initial price offer for 19 of the total 38 coal blocks on offer.
The second and final round of e-auction started on Monday and 12 mines have been offered so far. Vedanta, Hindalco, Adani and several newer players have won mines.
On Wednesday, the highest bid was received for the Gotitoria East & West mines in Madhya Pradesh (MP). Kota-based mining and quarrying company Boulder Stone Mart quoted the highest closing bid of 54 per cent premium on the revenue share.
Another mine in MP, Urtan North saw the highest closing bid of 9.5 per cent on the revenue share by JMS Mining. This Kolkata-based mining technology provider has won two mines of the same cluster in the ongoing auction. It won Urtan mine by quoting the highest closing bid of 10.5 per cent on the revenue share.
According to the auction methodology, the bid parameter is on a ‘revenue-share’ mode. The participants bid for a percentage share of revenue payable to the state government from the production and sale of mined coal.