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Centre mulls restricting coal mine auctioning to commercial use

Thursday, 18 Jul 2019
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The Central government is planning to allot or auction coal mines only for commercial use instead of auctioning to captive users. The allocation will be decided based on production plan and revenue share to the government.

The Union Ministry of Coal is also looking at a proposal to privatise and split Bharat Coking Coal (BCCL) that holds lease to the Jharia coalfields.

The lease areas of the Coal India (CIL) subsidiary could be divided into five to six parts, each held by a different company. Each of these companies could be privatised. The privatisation could take place through a profit-sharing model.

The proposal is to ask the existing captive mining lease holders, which have not yet started production, to surrender their blocks and pay a penalty of 10 percent of the bid security. Companies in sectors like steel, cement, power, coal-to-gas and coal-to-liquid used to apply for coal blocks and rights were given to them after scrutiny by an inter-ministerial committee. The committee is in favour of only one-stage competitive bidding with a maximum mining lease duration of 50 years.

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