Home ECONOMY Four large coal blocks in Odisha to be auctioned

Four large coal blocks in Odisha to be auctioned

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Odisha Sun Times Bureau
New Delhi, June 9:

In a bid to promote commercial mining, the Central government has planned to auction four large coal blocks in Odisha.

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The four coal blocks are Chhendipada I & II, Mahanadi and Machkata. Chhendipada I & II blocks have an estimated reserve of 1800 million tonnes of coal.

Mahanadi and Machkata blocks have a combined estimated reserve of 1400 million tonnes of coal.

These blocks will be allocated to companies interested in commercial mining of coal. Both national and overseas companies can partake in the auction process.

The government is readying a plan for sale of coal by captive miners after extraction. Coal blocks allocated to private companies till date have generated very little coal, about 170 million tonnes of coal reserves.

Blocks having reserves of 700-900 million tonnes of coal have been allocated to public sector enterprises like NTPC.

Though Chhendipada I & II are two separate block, they will be treated as one block at the time of auction, sources said. Similarly, Machkata and Mahanadi blocks will be allocated as a single block.

These four blocks have been included in the schedule-III category, which means partially developed blocks will be allocated to private companies.

As per provisions of the new coal mines policy, the government can change the end-user policy. In case a company finds after winning the bid in the auction that the block is economically unviable, it can withdraw from that block.

This method is already in vogue in the case of oil blocks. The government believes it work in case of coal blocks too.

The concerned state government is bound to grant prospecting license (PL) to the company winning the bid. Plans are afoot to auction blocks/mines towards the end of this year.

The government is preparing rules and regulations for the purpose. A workshop to discuss different aspects of commercial mining of coal will be held on June 23.