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Govt to auction seven coal mines

Wednesday, 15 May 2013
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The Central Government is planning to auction seven coal blocks shortly.


The blocks will be offered to private players in power, steel, and cement sectors under auction by Competitive Bidding of Coal Mine Rules, 2012. Of the total seven blocks, the power, steel, and cement companies will have two blocks each; one block would be open for mining. However, the Central Government has not yet disclosed the estimated coal reserve and locations of these seven blocks. These blocks will bear a minimum floor price that the winner of the mine will have to submit after the allocation. The Coal Ministry has appointed Crisil Infrastructure Advisory to come up with a methodology for calculating the floor price.


Meanwhile, the two blocks for power developers will get a discount on the reserve price on condition that the electricity produced should be sold to discoms on a long-term power purchase agreement.


Besides, the feasibility study of the mines has been completed, and expected mineable reserve, capital and operating cost and production rate are known.

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