Friday, June 24, 2022

Commercial coal mining: 3 mines that got single bids will be bid out immediately, says Joshi

Must read

  • The minister told the media that Madhya Pradesh saw the highest success rate and Jharkhand grossed the highest revenue in the e-auction process

  • The 19 mines will generate total revenue of approximately Rs 7,000 crore, and around Rs 1,048 crore will be received by states in the form of upfront payment, said Joshi

New Delhi: While hailing the results of the first-ever attempt at the auction of commercial coal mines as historic, Union Minister for Coal Pralhad Joshi declared that the 19 mines put on offer have been bid out successfully and added that the three mines which received single bids will also be bid out immediately. Addressing the media on Monday, Joshi said, “The result of the first-ever attempt at the auction of commercial mining has been historic and clearly proved that the opening of the coal sector was a step in the right direction. It will contribute to the growth of many sectors. We have successfully auctioned 19 mines, which is the highest number of coal mines auctioned under any tranche of auctions after 2015. The success of the auction is around 50 percent since 19 out of 38 mines put on auction have been bid out.”

Out of 19 mines, 11 are opencast, five are underground, and the remaining three are mixed, ie, underground and opencast. 

MP saw highest success rate and Jharkhand is the highest revenue-earner: Joshi

Sharing the details of the e-auction with the media, Joshi said that Madhya Pradesh, which offered the most number of coal blocks accounting for around almost 29 percent of the total blocks, has witnessed almost 73 percent success. “Jharkhand is the highest revenue earner in this coal auction and will get around Rs 2,690 crore per annum. This revenue does not include indirect benefits like employment,” the minister said.

The average premium was 21.81 percent for Madhya Pradesh (MP), 25.25 percent for Jharkhand, 18.8 percent for Odisha, 40 percent for Chhattisgarh, 30.75 percent for Maharashtra. State-wise annual revenue is Rs 1,724 crore for MP, Rs 2,690 crore for Jharkhand, Rs 1,059 crore for Odisha, Rs 842 crore for Chhattisgarh, and Rs 321 crore for Maharashtra, said Joshi.

The operationalisation of mines is expected to generate employment for approximately 14,669 people in MP, 27,310 in Jharkhand, 14,872 in Odisha, 9,734 in Chhattisgarh, and 2,434 in Maharashtra. 

Bidding process saw participation from diverse sectors: Joshi

While stating that that the 19 mines will generate total revenue of approximately Rs 7,000 crore, Joshi said that around Rs 1,048 crore will be received by states in the form of upfront payment and will be adjusted in the premium subsequently. 

He also added that contrary to the ministry’s expectations, players from diverse sectors took part in the bidding process. “It is interesting to note that participants in the bidding process also included players from several other sectors like real estate, infrastructure, pharma etc. It proves that opening up of the sector has generated interest from other sectors as well. The intention of removing the end-user criteria was to allow entry to new players,” he said. 

A total of 42 companies participated in the auction process, 40 of which were private players and two were PSUs. Commenting on the figure, the minister said, “This figure is significant for the first attempt for such auction. And I am happy to note that Andhra Pradesh Mineral Development Corporation, which participated in the bid won against five private players. This is most welcome and I congratulate APMDC.”

ALSO READ: Govt to come up with more bidding rounds, says Coal Secretary

Re-auction of 3 mines that received single bids to take place soon

The 19 mines that qualified for technical bidding received two or more bids and there were three more mines that had received single bids. “For the three mines that received only single bids… there’s a provision in the Cabinet decision, whatever the discovered price is for the single bid, keeping that as the base price, we will be going for the re-auction of those mines immediately. And in the second attempt, even if there is a single bidder, the mine will be allocated,” said the minister. 

(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram. Join PSU Watch Channel in your Telegram and stay updated)

- Advertisement -

More articles

- Advertisement -

Latest News