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Govt to auction 10 more mines to private companies by August

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05 June 2015

The ministry of coal has announced the auction of 10 coal mines to private companies, in the third tranche, after auctioning 29 coal blocks in two tranches.

The ministry said it has issued instructions to the nominated authority to conduct the auctions for these ten mines.

These 10 coal mines, with reserves of 858.19 million tones, will be auctioned to core industries such as iron and steel, cement as well as captive power plants and the process will be completed by August end.

The government has raised over Rs2,00,000 crore by auctioning 29 coal blocks in two tranches to private companies, surpassing CAG's loss estimates of Rs1,86,000 crore in the arbitrary allotment of mines earlier.

"We have lined up 10 coal blocks and all of these are in the unregulated sector... The auctions will be held from August 11 to August 17," coal secretary Anil Swarup said at a press conference.

"There has been lot of demand from the unregulated sectors in the nature of industries in cement, steel and so on ... So, these are the blocks which would be put up for auction," he said.

Of the total estimated geological reserves, these mines have extractable coal of about 356.245 million tonnes and they are located in Maharashtra, Jharkhand, Chhattisgarh and Odisha, he said.

The mining blocks to be auctioned include, MarkiMangli-I in Maharashtra, with estimated reserves of 0,30 million tonnes, the Parbatpur-Central block in Jharkhand (reserves of 1.24 million tonnes) - both classified as Schedule II.

The two mines are explored blocks having extractable reserves of 62.12 million tonnes, according to a coal ministry statement.

Other blocks (schedule - III) include the Dongri Tal - II block in Madhya Pradesh (reserves of 2.90 million tonnes), the KosarDongergaon block in Maharashtra (reserves of 0.30 million tonnes), the Margi Mangli-IV block in Maharashtra (reserves of 0,20 million tonnes), the Majra block in Maharashtra (reserves of 0.48 million tonnes), the Chitarpur block in Jharkhand (reserves of 3.45 million tonnes), the Bhaskarpara block in Chhattisgarh (reserves of 1 million tonnes), the Sondiha block in Chhattisgarh (reserves of 1 million tonnes) and the Jamkhani block in Odisha (reserves of 2.60 million tonnes), Swarup said that of the 10 mines to be auctioned, five are those which went unsold in the first two tranches earlier this year.

He further said that by and large the government will follow the same process as was followed in the auctions held earlier this year with just one change.

The modification is "that on this occasion we will treat multiple bids of a single entity as a single bid in terms of determining the 50 per cent qualifiers", Swarup said.

The policy for the linkages is expected to be approved in a month's time.

The notice inviting tender (NIT) will be issued on 8 June 2015 while bid will be received till 21 July. The e-auctions for these mines will be held from 11 August 2015 to 17 August 2015, a coal ministry release stated.

He further said the ministry was considering auction of coal linkages for unregulated sectors, including cement and steel, for five years.

The ministry is seeking comments from the stakeholders on methodology for proposed auction of coal linkages/LoAs to non-regulated sector through competitive bidding.

Swarup said the ministry will issue draft policy details for seeking comments of various stakeholders.

The ministry is also considering extending the linkages for existing holders by a year till 30 June 2016. After that, the existing linkage holders will also have to bid, Swarup said.





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