MAC: Mines and Communities

India gov't coal mines auction is failing

Published by MAC on 2019-10-12
Source: CNBC (2019-10-10)

The Indian government's grand design to auction many domestic  coal mines to all and sundry, now seems to on the verge of  collapse [see: India seeks to avoid vital legislation ].

Auction of 21 coal mines cancelled as govt sees tepid response

CNBC

10 October, 2019

Auction of 21 coal mines has been cancelled by the ministry as it received
less than three bids for them.

According to the norms of the coal auction under the Coal Mines
Nationalisation Act, each mine requires minimum three bids for the
government to hold auction.

The coal ministry has received valid interest for only six coal mines out
of the 27 which were offered for the iron & steel, cement, and captive
power plant end-use. Auction of 21 coal mines has been cancelled by the
ministry as it received less than three bids for them.

According to the norms of the coal auction under the Coal Mines
Nationalisation Act, each mine requires minimum three bids for the
government to hold auction.

Jamkhani coal mine, situated in the state of Odisha, has attracted maximum
bids including from companies like Vedanta, JSW, Hindalco, JSPL, Rungta
Mines and Natural Resources Energy Limited.

"The response to the coal auction has been subdued, mainly because of the
market sentiment and also changes in policy," said a source from the coal
ministry.

The technical bids will be examined starting October 17 and the auction
will begin on October 24. The government has allowed 25 percent commercial
sale of coal from the mines offered on auction.

The auction process was incorporated in 2014, post deallocation of 214
coal mines. India has not seen a successful auction of coal mines after
the first round where it auctioned 24 coal mines, out of which about 12
are now in production.

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