Auctions for 2nd Tranche of Commercial Coal Mining, 2021

India launched (March 2021) its 2nd Tranche of auction for commercial coal mining offering 67 mines for sale of coal. This is the highest number of mines on offer in a particular tranche of auction after commencement of the auction regime since 2014.

Out of the total 67 mines offered by the Ministry of Coal, 23 mines are under CM (SP) Act and 44 under MMDR Act. The coal mines on offer are a mix of mines with small and large reserves, coking and non-coking mines and fully and partially explored mines spread across 6 States Chhattisgarh, Jharkhand, Odisha, Madhya Pradesh, Maharashtra and Andhra Pradesh.

Commercial coal mining will bring in new investments, create huge employment opportunities and boost socio-economic development in coal-bearing states. A market-based coal economy will help the nation become Aatmanirbhar in coal.

The government is moving towards adopting a Rolling Auction mechanism for conducting future auctions. Coal is the first mineral resource where Rolling Auction mechanism is being implemented in which a pool of coal blocks will always remain available for auctions.

In this tranche of auction, special emphasis has been given on protection of the environment. Coal blocks have been selected in those areas where forest cover is low, coal quality is good, mines are close to the infrastructure facilities and resettlement & rehabilitation has to be done at the minimum. More coking coal mines have been offered so that India’s import of coking coal can also be reduced.

Technical Bids

The last date of submission of Technical Bid was July 08, 2021. As part of the auction process, Technical Bids comprising of online and offline bid documents were opened on July 09, 2021.

A total of 34 bids have been received for 19 coal mines of which 10 are fully explored mines and 9 are partially explored mines. 4 of these mines are coking coal mines and the remaining 15 mines are non-coking coal mines. Two or more bids have been received for 8 coal mines. A total of 20 companies have submitted their bids in the auction process.

# Coal Mine Bids
1 Alaknanda 1
2 Beheraband North Extn 1
Bhaskarpara 3
Bhivkund 2
Burakhap Small Patch 5
Burapahar 1
7 Choritand Tiliaya 1
8 Dahegaon/Makardhokra-IV 1
9 Dip Extn Of Belpahar 1
10 Gondbahera Ujheni East 1
11 Gondkhari 2
12 Jhigador 2
13 Jogeshwar & Khas Jogeshwar 3
14 Khargaon 2
15 Lalgarh (North) 1
16 Ramnagar 1
17 Rauta Closed Mine 4
18 Shankarpur Bhatgaon II Extn 1
19 Tokisud Block II 1
  Total Bids 34

First Tranche of Commercial Coal Mining

19 mines were successfully auctioned in the first-ever tranche of commercial coal mining auctions held in 2020 with the premium quoted by the successful bidders ranging from 9.5% to 66.75%. The agreements between the Ministry of Coal and the successful bidders were signed in January 2021. States will fetch around Rs. 7000 crores of revenues from these auctions considering production at peak rated capacity of 51 Million Tonnes Per Annum (MTPA).