Law for coal blocks bidding on anvil

[BUTTERFLY: Nature Club of India]

Law for coal blocks bidding on anvil
http://igovernment.in/site/law-coal-blocks-bidding-anvil-38177

Group captive mining from coal blocks will continue till the laws for
competitive bidding comes in force
Published on 08/11/2010

New Delhi: The Ministry of Coal has decided to promote production
sharing from captive coal blocks until laws are in place for the
competitive bidding for coal blocks through auction. A regulatory body
for the coal sector is also on anvil.

A Bill to enact this legislation is scheduled to be introduced in the
current session of the Parliament.

Union Coal Minister Sriprakash Jaiswal said, "We need to open the
sector for bringing market discipline. However, this needs political
consciousness. Pending the same, government is encouraging group
captive-mining to augment production from captive blocks. Of the total
208 blocks allotted to different companies in both the private and
public sectors, only 25 blocks have commenced production, which is not
desired by the government."

As part of the government policy promoting group sharing from captive
mines, a non-coking coal block of Moira-Madhujore in West Bengal with
an estimated reserve of 685 million tonnes has been allocated to the
Adhunik Group on a sharing basis with Uttam Galva Steels Limited, ACC
Limited, Vikas Metal & Power Limited, Mideast Integrated Steel
Limited, and Ramsarup Lohh Udyog Limited, part of Ramsarup Industries
Limited. Barring ACC, which is part of the Holcim Group, all of the
companies mentioned above are mid-sized steel producers.

Behrabandh, a coking coal block in Madhya Pradesh with estimated
reserves of 170 million tonnes, has been allocated to Ispat Industries
on a sharing basis with the Essar Group, Mukund Steels, and Ind
Synergy.

"Now, allotment of coal blocks is through the nomination route only,
and the proposed allotment of coal blocks through competitive bidding
envisages bringing in transparency and serious players. The
legislation for competitive bidding will be introduced in Parliament
through a bill shortly. But allotment of coal blocks through
nomination to government companies controlled by the state or central
governments will continue," Jaiswal elaborated.

He added that India will continue to depend on imports to meet the
rising demand of coking coal, since proven coking coal reserves in the
country are only 16 per cent of the total proved coal reserves
available.