The government on Thursday kickstarted the auction process for cancelled coal mines with the launch of a web portal for electronic bidding for 24 coal blocks in the first tranche.
The Union Cabinet approved re-promulgation of the coal ordinance and necessary guidelines for mine allocations, a move that could make the kitty of coal-rich states fatter by Rs 7 lakh crore over the next 30 years.
Entire auction process will be transparent, efficient and conducted online, said Coal and Power Minister Piyush Goyal while launching the portal for e-auction of 24 coal mines – www.mstcecommerce.com/auctionhome/coalblock.
“With this, the registration process has been started and interested bidders with end use plants could visit MSTC website for the purpose. The registration process will be as per KYC norms,” an official statement said.
Goyal said the auction process will comprise technoâ commercial bid for qualification and financial bid (e-auction) for selection of successful bidder.
“Only 50 per cent of the qualified bidders from technical stage (subject to a minimum of 5 bidders) will be allowed to participate in the e-auction process,” the statement said.
It said mines set aside for iron & steel, cement and CPPs will be auctioned through ‘ascending forward auction’, where qualified bidders will quote incremental bids above the pre- determined floor price.
“Mines to be allocated for power sector will be auctioned through ‘descending reverse auction’ to minimise impact on power tariffs of end use plants. Last date for receiving technical bids will be January 31 and list of qualified bidders will be placed on February 12,” it added.
The statement said e-auction of coal mines for qualified bidders will be held from February 14-22. The entire mine allocation process for Schedule II (42 producing mines) will be completed by March 23 with the signing of Coal Mine Development & Production Agreement.
It added that the second phase of auction for 32 mines will commence soon. Goyal has yesterday said the auction and allotment will reduce imports and added that thermal coal import can also be brought down significantly and the government was aiming to eliminate it completely in the next 2-3 years.
The 24 mines for which auction process has started include 7 for the power sector, 16 for other end-use steel and cement plants as also captive power units, and one mine for steel.
Coal Secretary Anil Swarup had yesterday said the eastern states, as per conservative estimates, stand to gain Rs 7 lakh crore from auction and royalty over the next 30 years.
The auction follows the Supreme Court order in September that quashed allocation of 204 coal blocks to various companies since 1993.