Help Desk -
9717405332, 9599714297, 9810335381

Govt forms panel to find ways to increase output of captive coal blocks

Coal News - Published on Fri, 29 Dec 2017

Image Source: ET
Economic Times reported that cabinet secretary PK Sinha along with secretaries of power, coal, steel and top officials of several other ministries will look in to the reasons for low coal output from captive coal blocks and mull various options to raise their production.

Over 40 captive blocks were producing close to 40 million tonnes before the Supreme Court cancelled all licences in 2014. Now the production is about 16 mtpa as a number of blocks once operational are yet to resume mining due to legal issues and lack of green clearances.

A senior government official said that "A high level committee comprising cabinet secretary and secretaries of various ministries has been set up to look into the bottlenecks and roadblocks in the operationalisation of coal blocks. It will suggest ways to overcome the issues and also raise production,".

ET had on December 25 reported that the government is considering shifting to a production or revenue sharing model similar to the bidding of oil blocks for coal blocks. The coal ministry has set up an expert panel headed by former CVC Pratyush Sinha to examine challenges of the current bidding system and suggest changes for conducting future auctions of coal mine.

The government has auctioned 17 operational mines and allotted 18 such blocks to government companies, coal ministry data said. Of these total 35 blocks that were operational at the time of allocation, 15 have resumed mining. Out of 49 mines that were scheduled to begin mining from June 2018, three have started functioning ahead of time, the data showed.

The production in the year 2016-17 from the auctioned/allotted operational coal mines is 15.3 million tonnes as compared to production of 15.8 million tonnes from these coal mines in the FY 2014-15 i.e. prior to cancellation of allocation of these coal mines, it said. Action has already been initiated against the five non-operational auctioned coal mines.

Further, show cause notices for 15 allotment coal mines have been issued for deviation from the scheduled timeline. Of these 15 blocks, six allotted coal blocks have not been operationalised because of legal hurdles relating to mine development organisations. The remaining nine blocks are expected to start production in the year 2018-19, the coal ministry data said.

Also, of the eight power companies that were allocated coal blocks, five have moved to court to challenge the government's decision to disallow pass through of quoted discount on coal cost on final power tariff. The companies bid aggressively to forego their mining costs for inclusion in tariff calculations.

The coal ministry in response to an ET query said, grant of approvals, sanctions and clearances is being monitored through review meetings involving state governments and concerned agencies at the level of joint secretary and secretary.

Source :

Posted By : Nanda Koijam on Fri, 29 Dec 2017
Related News from Coal segment