Policy

‘Open to tweaking commercial coal mine auctions to get States on board’

Twesh Mishra New Delhi | Updated on July 01, 2020 Published on July 01, 2020

The Centre is open to tweaking commercial coal mining auctions on the request of State governments, Coal and Mines Minister Pralhad Joshi said.

In an interview with BusinessLine, the Minister said that now, 40, instead of 41 coal mines are on offer for commercial mining. Commenting on the discussions he had with States, Joshi said that both Jharkhand and Chhattisgarh are on board with the idea of auctioning mines.

But, Jharkhand has expressed reservations on the timing of the auctions while Chhattisgarh is concerned about the ecological impact of four mines being auctioned from the State. Joshi said that other mines from Chhattisgarh can be put up for bids if the State insists. Excerpts:

Some States have expressed concerns about the commercial coal mines auctions. How will you address their concerns?

The mines up for auction are largely in Odisha, Jharkhand, Chhattisgarh, Maharashtra, and Madhya Pradesh. Of these, only Jharkhand has said that this is not the appropriate time for auctions, but has not opposed it. On concerns being raised, I would like to clarify that this is not a matter of prestige for anyone and we would want to take on board the State governments before going ahead.

The Jharkhand Chief Minister, in a letter, lauded us for adopting commercial coal mining if it brings investment and jobs into his State. He is concerned that the ongoing pandemic may dampen investor sentiment. The investments will come after 8-10 months for the advanced (nearer to production) mines. For other mines, it will take some more time.

So, I appeal to the CMs to interact with those who have expressed interest in mining in their States. Forty mines have been selected based on the mining companies’ interest. For even the smallest mines, at least five entities have shown interest, and in some cases, it has gone up to 15. This is the best-ever response we have got for coal mining.

Chhattisgarh has also welcomed our move. But, there is a river just adjacent to four coal mines that are being offered. They would want to change these blocks and offer others instead. We are in consultation with them and we would change and replace them, there is no issue in that.

All States are supporting except West Bengal. Even Chhattisgarh Chief Minister had written asking us to expedite the auctions.

International players are invited to participate in the commercial coal auctions. Will you welcome Chinese players too?

Chinese companies can also participate if they are coming and investing, and their investments will be subject to all other clearances. There should not be any other problem because their money is coming to us. They are producing about 3.58 billion tonnes of coal per annum in their country. We have not reached even 1 billion tonnes here. People need to understand how China used coal to produce cheap electricity and support the growth of industry. On the other hand, we are in a situation where we have such large coal reserves but still end up importing coal. This is the most unfortunate part.

Our coal must be used to provide employment to our people while balancing the environment needs. Importing coal means providing jobs somewhere else but bringing pollution to our country.

Is complete import substitution possible for imported coal-based power plants? What about coking coal, how do we minimise imports?

Complete import substitution is not possible for imported coal-based power plants. But we can provide better quality domestic coal for blending. There are not many plants that are like this and in days to come, we may be producing that good quality of coal too, we don’t know that yet. Jharkhand has very good quality of coal.

With respect to coking coal, we have slightly higher ash content in domestic coking coal. We can wash it and blend it so that overall, we can reduce coal imports.

At present we are importing 230-250 million tonnes of coking coal. Our goal is to bring down imports to 100 mt or less by 2023-2024.

What is the position within the government regarding coal washing?

There is little rationale to mandate coal washing for thermal power plants. Now almost all thermal power plants are having ash arresting technology. Further, nearly 70-80 per cent ash that is generated at a power plant is used in cement industry, road laying and brick making. Washing is a relatively inefficient method for thermal power plants as they also need to ensure transport for washed coal. The Environment Ministry had heard the pleas of thermal power producers and given necessary relaxations.

Now washeries will exist for coking coal to improve its efficiency and better grades but will not be mandatory for thermal power plants.

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Published on July 01, 2020
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