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Business News/ News / India/  House panel suggests Coal India to explore acquisition of overseas coal blocks
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House panel suggests Coal India to explore acquisition of overseas coal blocks

In its latest report, the parliamentary standing committee on coal, mines and steel noted that Coal India had acquired blocks in Mozambique, but due to lack of cost effectiveness, the company surrendered the licences in 2016

File photo of coal being mined in India.Premium
File photo of coal being mined in India.

As India eye’s energy security amid the volatile geopolitical situation, the parliamentary committee on coal has recommended the Centre and Coal India to look at acquisition opportunities for coal mines abroad.

In its latest report, the parliamentary standing committee on coal, mines and steel noted that Coal India had acquired blocks in Mozambique, but due to lack of cost effectiveness, the company surrendered the licences in 2016.

Noting that at present the state-run coal mining major is not pursuing acquisition of any overseas coal blocks, the committee shared by member of Lok Sabha, Rakesh Singh said: “CIL can still pursue overseas acquisition of coal blocks after detailed stud and analysis of the blocks especially low ash coking coal which is not abundantly found in the country and import is the only option left. The committee is of the firm opinion that this will not only reduce import but also open new avenues of mining abroad."

It said that considering the existing coal resources in the country, the committee said that the ministry of coal and Coal India should explore acquisition of coal blocks abroad.

It has also asked the ministry to apprise it of the developments in this regard.

The suggestion comes on the backdrop of the supply crunch in April-May when India had to increase its import of coal despite high international prices as the country was staring at a power crisis scenario.

India has also ramped up its domestic coal production this year. Coal production in the country may touch 900 million tonne this fiscal.

With rising domestic production and high imports this year, the government seems to be confident to meet the power demand in the peak demand season of April-May 2022.

Coal minister Pralhad Joshi, recently informed the parliament, that around 3.58 lakh tonne of coal has been imported by Coal India Limited (CIL) from Indonesia year on behalf of thermal power plants (TPP) of state generatio companies (genco) and independent power plant (IPP). Citing data from the ministry of power, he further said 86% of the imported coal has been utilized.

In November, Joshi had said that India is unlikely to face a coal shortage situation during the next peak power demand period in April-May 2023 as it would have adequate coal stock. He said that by March end 2023 the coal stock at thermal power plants in the country will stand at 40 million tonne.

The parliamentary panel in its report also said that the ministry of coal has informed it that Coal India is making efforts to achieve zero coal import mission by 2023-24 for substitutable coal.

“The committee expect that with te increased coal production targets of 1 billion tonne, there should not be any imports for coal which could be substituted with domestically produced coal and through IMC (inter-ministerial committee) all consumers be pursued not to go for import of coal and use domestically produced coal."

The committee has also asked the IMC to apprise it regarding the achievement in reducing coal imports and promotion of consumption of domestically produced coal.

It has also sought information on new mining site explored or developed by coal companies.

The committee has also recommended that increased impetus should be given to start mining in new areas after getting the necessary environment and forest clearance and also sought information of the new mining areas planned for the next three years.

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Published: 23 Dec 2022, 07:45 PM IST
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