Ministry of Coal launches ‘2nd attempt’ of coal auction for 11 mines

Ministry of Coal launches ‘2nd attempt’ of coal auction for 11 mines

After urging private companies and mining operations including Hindalco, EMIL and Adani coal project to scale up coal production, the Coal Ministry announced a ‘2nd attempt’ of coal auction for 11 mines

Coal stockpiles in India have reached dangerously low levels. Data from the Central Electricity Authority revealed that the current inventory levels are the lowest since November 2017. The scarcity has led to many power plants closing shop, leaving the power sector in the lurch. Electricity demand rose more than 10 per cent and 18 per cent in July and August respectively and is expected to increase further as the economy gradually gains momentum.

In light of the developing situation, the Ministry of Coal has deemed it necessary to step up coal production in the country. The ministry had already directed the Vedanta, EMIL and Adani coal project, among others, to increase production. Over the past five years, 43 coal mines were awarded to private players in a series of coal mine auctions – 34 mines in the first-ever e-auctions in 2015 and another nine, last year.

The ministry also decided to launch a ‘second attempt’ to auction 11 coal mines for commercial mining. These mines were initially offered in March this year but were not picked up by any of the bidders. Out of the 11, six mines are fully explored and the remaining five partially explored. This announcement comes after the Coal Ministry signed agreements with the eight successful bidders in the second tranche of auctions. The signatory parties include Sunflag Iron and Steel Company Limited, South West Pinnacle Exploration Limited, Prakash Industries Limited, CG Natural Resources Private Limited, Shreesatya Mines Private Limited and Adani. Coal project operations in these mines will definitely boost coal production and strengthen the Aatmanirbhar Bharat vision.

The second tranche of auction, Adani and its subsidiaries won three mines – Khargaon and Jhigador in Chhattisgarh and Gondkhari in Maharashtra. The Group is one of the largest MDOs in the country and is present in nine mines across the country. Parsa East & Kanta Basan with 452 mineable reserves and Gare Pelma III Coal Block with 134.10 mineable reserves have already commenced production under Adani. Coal projects in the remaining seven mines are in various stages of development as of now.

Shreesatya Mines and Prakash Industries were also big winners, scooping up Burakhap Small Patch and Bhaskarpara mines respectively. South West Pinnacle gained the Jogeshwar & Khas Jogeshwar block in Jharkhand, with the Bhivkund coal mine in Maharashtra going to Sunflag Iron and Steel.

India’s coal requirement is projected to hit 1,123 million tonnes (mt) by 2023 with a majority of the mined ore going into power generation. Although the shift to green energy is moving on at a steady pace, the present power crunch has highlighted the importance of coal-fueled power generation in India.


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