Bidders will be able to submit preferences for auctions
The govt on Thursday listed 67 mines for the second tranche of commercial coal mine auctions
India seeks to further liberalize its coal mining regime to ensure greater participation of all stakeholders, by allowing bidders to submit preferences for future mine auctions.
Besides, as part of the Centre’s plan to usher in structural reforms in the coal sector, state-run Coal India Ltd is looking to merge e-auction windows to move toward a ‘one price for one coal grade’ system. Coal and mines minister Pralhad Joshi announced the proposed initiatives at the launch of the second tranche of commercial coal mine auctions on Thursday.
The moves assume significance considering that India has the world’s fourth largest reserves and is the second-largest producer of coal. With global shift to green energy to address growing environmental concerns, the Indian government is trying to harness coal reserves within the next three decades.
The so-called ‘rolling auction’ mechanism announced by the minister will ensure that coal blocks are always available for auction.
The initiative comes at a time when the global window for future coal mining is getting shorter.
“We are making coal the driver of economic activities in the country," Joshi said in a ministry statement. India’s coal requirement is expected to go up to 1,123 million tonnes (mt) by 2023 from the present level of 700 mt.
“With rolling auctions, we will upload a comprehensive list of mines along with key technical data and bidders can submit their preferences for the mines to be included in the next tranche of auction. This would be a continuous process and would result in expediting the auction setup. Moreover, it will also help bidders in planning better and would further enhance transparency in the system," Joshi said.
On Thursday, India listed 67 mines in Chhattisgarh, Jharkhand, Odisha, Madhya Pradesh, Maharashtra and Andhra Pradesh for the second tranche of commercial coal mine auctions.
“This is the highest number of mines on offer in a particular tranche of auctions after the commencement of the auction regime since 2014," the ministry added.
The two-stage auction process allows bidders to quote the percentage revenue share over the reserve price. Besides there will be no restriction on the sale and utilization of coal from the mines. Earlier, blocks were allocated to companies on payment of fixed amounts per tonne.
“Start of commercial coal mining is the most revolutionary and progressive measure taken in the coal sector in India," NITI Aayog chief executive officer Amitabh Kant said at the event.
“The coal mines on offer are a mix of small and large reserves, coking and non-coking mines and fully and partially explored mines," the ministry said.