New Delhi: Additional Coal Secretary M Nagaraju has said that with the second tranche of commercial auction of coal mines, the government is moving towards a rolling auction mechanism. Addressing the 1st Stakeholders' Consultation on 2nd Tranche of Auction of Coal Mines for Commercial Mining, organised by Ministry of Coal, jointly with FICCI, Nagaraju said, "From this ongoing tranche of auction, Ministry of Coal is moving to a rolling auction mechanism wherein any un-auctioned mine shall remain available for auction on the portal, with more mines being added as and when available."
While assuring the industry of all support, Nagaraju said, "We are offering 67 mines with a total resource of almost 36 bn and explored mines PRCs of about 150 million tonnes (MT) in the second tranche auctions of coal mines for commercial mining. This is the biggest ever offer of coal mines in the country."
"The offers, which are in almost all coal-bearing states, give great opportunity and chance to the industry to pick the relevant and useful mines depending on their requirements," said the Additional Coal Secretary.
Manoj Kumar, CMD, CMPDIL and Western Coalfields Ltd (WCL), said that there are 67 coal blocks in this tranche — 23 of which are CMSP and 44 are MMDR blocks; 37 are fully explored, while remaining 30 are partially or regionally explored.
Dilip Chenoy, Secretary General, FICCI, said that the second tranche auctions of commercial coal mines are an important step towards the commitment of increasing the availability of coal across the different segments of the industries and reducing the burden on coal imports. "Initiatives taken by the Ministry of Coal for ensuring environment-friendly and sustainable mining, adoption of cutting-edge technologies, including coal gasification and CBM projects will help in ensuring sustainable growth in this endeavour," Chenoy added.
The second tranche auction process was formally launched by Union Minister of Coal Pralhad Joshi and NITI Aayog CEO Amitabh Kant on March 25. Following up with the pre-bid meeting held on April 26, the ministry of coal is organising a series of two stakeholder consultations under the aegis of FICCI for wider outreach to potential bidders. SBI Capital Markets Limited, a subsidiary of State Bank of India, is the Transaction Advisor to the nominated authority for the auction process.
The stakeholder consultation saw participation of leading players from coal and mining business, equipment manufacturers, mine developers and operators (MDOs) and financial institutions. The auction shall be held online through a transparent two-stage process. Key highlights of this auction process are — market linked mechanism wherein bidding shall be based on percentage revenue share, national coal index-linked payments, ease in participation with no restriction for prior coal mining experience, optimised payment structures, efficiency promotion through incentives for early production and use of clean technology, flexible operating terms etc.
It is also expected that the rolling auction mechanism will expedite the allocation process of coal mines, bringing in greater transparency, ensuring better availability of mines on offer to potential investors. The sale of tender document started from March 25 and the bid due date is June 24.
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