Three months after the conclusion of the first two rounds of coal block auctions, 12 out of 28 awarded blocks are awaiting green clearances and State-level approvals to begin mining.
State-level problems relating to environment and forest clearances in some cases and handing over of the entire land in other cases have led to delays in mining activities.
Delays also occurred as prior approvals of the previous block owners needed to be transferred to the winning bidders. While this has been expedited by the Ministry for Environment and Forests through an amendment to the environment clearance norms, it has delayed projects such as Essar Power’s Tokisud North in Jharkhand.
Essar Power had won the coal block at ₹1,110 a tonne, the highest for a power sector block in the two rounds of auctions.
Of the remaining winners which are waiting for all clearances, seven are from the power sector.
Coal Ministry officials are confident that the remaining issues will resolved soon.
“We have worked at a quick pace and resolved a lot of the pending issues for 16 block winners. For example, Sial Ghogri and Mandla North’s problems were resolved recently. In the next couple of months we are confident that the remaining winners will also be able to begin mining,” a senior Coal Ministry official said.
“Also, most of the larger blocks with the highest bids are already close to mining. While we are aware of the delay in other cases and are working to resolve it expeditiously, it is not a major worry,” the official added.
According to the official, mining has already begun in about 5-6 blocks. The Nominated Authority will hold a meeting on July 17 to review the status of production at the 16 blocks where vesting order has been issued to the successful bidder.
Since the delay is not on the part of the companies, there is no threat to the performance bank guarantee. However, once all approvals and clearances are provided to the block winners and the mining plan is approved, any delay will result in a part of the bank guarantee being seized.