Proposal to auction two more mines in Jharkhand put on hold

A view of a coal mine in Jharkhand. The government’s plans to auction two more coal blocks in Jharkhand has been put on hold because of some issues involved. File photo

The government’s plans to auction two more coal blocks in Jharkhand has been put on hold because of some issues involved.

The government on Wednesday had put three other mines in Jharkhand and West Bengal on block for captive use, beginning the process for the first ever auction of mines.

“A Coal Ministry panel had proposed to earmark five coal blocks for auction. However, the Coal Ministry decided to put only three on block and keep the remaining two on hold as there were some issues involved,” said a source privy to the development.

The two coking coal blocks proposed for auction are North Kathara (Phase-I) and North Kathara (Phase-I and III) in Jharkhand, the source said, adding that the the technical committee had proposed to earmark the mines for steel firms.

“After discussion, the committee (technical) proposed to earmark the five coal blocks (for auction) : North Kathara (Phase-I), North Kathara (Phase-II and III) and Jhirki and Jhirki (West) all coking coal blocks located in the state of Jharkhand for specified end-use i.e., steel... Andal-Babuisol a CBM (Coal Bed Methane) Released coal block located in Raniganj to be earmarked for end-use .i.e. DRI (Sponge Iron)... (and) Tokisud II a CBM Released coal in the state of Jharkhand,” said a Coal Ministry document.

The Centre had drawn flak for delaying the auction. The CAG earlier said allotment of 57 mines to private firms without auction had resulted in a notional loss of Rs. 1.8 lakh crore to the exchequer.

The Ministry of Coal has offered three blocks for auction for captive use for steel, cement and sponge iron companies-two in Jharkhand and one in West Bengal.

Last year, the government had allocated 17 coal mines to central and state public sector units, including four to NTPC.

It had planned to auction 54 coal blocks with total estimated reserves of about 18 billion tonnes.

The blocks in Jharkhand include Jhirki & Jhirki (West) of East Bokaro Coalfield having geological reserves of 267.91 MT and Tokisud-II of South Karanpura Coalfield with 127.692 MT of reserves.

The mine in West Bengal, Andal Babuisol of Raniganj Coalfield, has about 103.841 MT of reserves.

Amid the controversies shrouding coal blocks allotment, the government for the last two years has been saying that the auction would take place shortly.

The Cabinet last year in September had approved the methodology for auctioning coal blocks, providing for upfront and production-linked payments and benchmarking of coal sale prices.