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Sarda Energy and Minerals place winning bid for Gare Palma IV/7 coal mine in Chhattisgarh

Sarda Energy and Minerals Ltd quoted a revenue share of 66.75% for the mine having a total geological reserve of 234.205 million tonnes.Premium
Sarda Energy and Minerals Ltd quoted a revenue share of 66.75% for the mine having a total geological reserve of 234.205 million tonnes.

  • Sarda Energy and Minerals quoted a revenue share of 66.75% on the last date of India’ first commercial coal mine auction
  • Others in fray were Adani Enterprises Ltd, Bharat Aluminium Company Ltd (BALCO), Jindal Power Ltd, JSW Steel Ltd, DB Power Ltd, Hindalco Industries Ltd and Nuvoco Vistas Corporation Ltd

NEW DELHI : Sarda Energy and Minerals Ltd placed the winning bid for Gare Palma IV/7 coal mine in Chhattisgarh by quoting the highest ever revenue share or premium over and above the floor price in the first commercial coal mine auctions that ended today, said a government official.

Sarda Energy and Minerals Ltd quoted a revenue share of 66.75% for the mine having a total geological reserve of 234.205 million tonnes.

Adani Enterprises Ltd, Bharat Aluminium Company Ltd (BALCO), Jindal Power Ltd, JSW Steel Ltd, DB Power Ltd, Hindalco Industries Ltd, and Nuvoco Vistas Corporation Ltd were also in fray today for the Gare Palma IV/7 coal mine.

The union coal ministry auctioned 19 coal mines in the first tranche of commercial coal mine auctions that began on 2 November. The mines are being awarded on a revenue-sharing basis, while earlier blocks were allocated to companies on the payment of fixed amounts per tonne.

While addressing a press conference on the last date of India’ first commercial coal mine auctions that began on 2 November, union coal minister Pralhad Joshi said, “In our first-ever attempt at auction for commercial mining, a large number of mines were put up for auctions and bidding in a single tranche."

“It was the 11th tranche of auction under CMSP Act, 2015 and first tranche of auction under MMDR Act, 1957," he added.

While a total of 38 coal mines were initially put-on auction by the coal ministry, a total of 19 mines are finally being bid out. There were initially 76 bids from 42 companies for 23 coal mines, with the remaining 15 mines not getting any bids. Of these 42 companies, 40 are private sector firms. Also, four mines got only one bid, putting these 19 mines out of the auction process.

“At requests of Chhattisgarh and Maharashtra, 5 mines (Morga South, Fatehpur East, Madanpur (North), Morga-II and Sayang) were removed from Chhattisgarh and 1 (Bander) from Maharashtra. 03 new mines (Dolesara, Jarekela and Jharpalam-Tangarghat) were added to Chhattisgarh. Finally, the list of mines put on auction was revised to a total of 38 mines," Joshi said.

As part of the two-stage auction process, a bidder has to quote the percentage revenue share over the reserve price. There will be no restriction on the sale and utilization of coal from these mines.

The final successful bidder list includes; Aditya Birla Group’ EMIL Mines and Minerals Resources Ltd (Bandha and Radhikapur East), Adani Enterprises Ltd (Gondulpara and Dhirauli), Aurobindo Realty and Infrastructure Pvt Ltd (Urma-Paharitola, and Takli-Jena-Bellora North and South), Boulder Stone Mart Pvt Ltd (Gotitoria—West and East) and JMS Mining Pvt Ltd (Urtan North and Urtan).

Also, Jindal Power Ltd (Gare Palma IV/1), Vedanta Ltd (Radhikapur West), Hindalco Industries Ltd (Chakla), Andhra Pradesh Mineral Development Corp. Ltd (Brahmadiha), Fairmine Carbons Pvt Ltd (Rajhara North—Central and Eastern), Sarda Energy and Minerals Ltd (Sahapur West), Yazdani International Pvt Ltd (Marki Mangli II) and Chowgule and Company Pvt Ltd (Sahapur East) placed the winning bids.

“While launching the auctions, it was broadly expected that investors related to mining, power and clean coal sectors would explore opportunities. But it is interesting to note that participants in the bidding process also include players from several other sectors like Real Estate, Infrastructure, Pharma, etc. It proves that opening up the coal sector has garnered interest from other sectors as well," Joshi said.

India’s coal requirement is expected to go up to 1123 million tonnes (mt) by 2023 from the present levels of around 700 mt. The earlier plan was to mine 1.5 billion tonnes of coal by 2020. Despite having the world’s fourth largest coal reserves, India imports around 235 million tonnes (mt) of coal, of which around 135mt can be been met from domestic reserves.

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