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Viewing report
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Development of Isolated Coal Blocks in India: Exploring the Opportunity
Infraline Energy, Dec 2010, Pages: 70
The demand for coal grows at a staggering pace of CAGR 8.5% as against a stagnant growth of 5.5 to 6% of coal supply. CIL has been struggling to meet the coal supply commitments under FSA and even resort to coal imports to bridge the demand supply gap. In this hard hit supply regime, government of India is pulling all its resource to increase coal production and looking beyond the conventional approach of coal production by CIL and its subsidiaries.
In its effort to enhance coal production and optimise the coal resource available in India, Government is finalising its policy to develop small isolated coal patches which do not come under the purview of CIL and captive coal category. Though the resource base for these coal patches are not huge but it can well meet the need of local coal consuming industries and eventually help in development of the rural economy.
The prevailing policy for allocation of these coal blocks lacks transparency and non-serious players end up getting these coal blocks. Neither CIL nor the state mining corporations are serious in developing these coal blocks because of its location and less resource base. Experts are of the opinion that to develop these coal patches in an efficient and economical manner, it should have been allocated by competitive bidding and wherever possible bundling with abandoned coal blocks may be considered to lure the private players into this sector.
Currently, the government is finalising the rules and regulations of competitive bidding for coal blocks. In this scenario, experts argue that these blocks (isolated patches and abandoned coal blocks) should fall under this category with no conditions for self-consumption clause as in case of captive coal blocks.
The author’s latest report highlights the untapped potential of these small isolated coal patches along with the prevalent policies on the same and the strategy to develop these coal blocks. It also covers the investment scenario for these coal blocks along with abandoned coal blocks and captures the issues and concerns around the same.
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