Coal ministry to put 50 more mines up for auction, plans three thermal plants

As the central government plans a gradual shift toward renewable energy, the reality on the ground is that India’s dependency on coal will probably not end anytime soon, especially considering the disruptions in supply chains globally owing to the Russia-Ukraine conflict.

However, the coal ministry is diversifying toward greener options to help the Centre achieve its net zero emission target.

In a detailed interview with IANS, union coal ministry secretary Amrit Lal Meena spoke at length on various initiatives in the sector, as well as plans to enter newer fields, and the ongoing commercial coal block auctions.

Q: The coal ministry has prepared a multi modal connectivity plan. What exactly does it entail?

A: Currently around 62 per cent of coal is transported by rail, 20 per cent by road and 18 per cent is moved through conveyor belts.

Rail is the most cost effective and environment-friendly medium to transport coal. Therefore, to strengthen rail infrastructure in coal producing states, there is a mandate under PM Gatishakti to allow user ministries to make plans according to their requirements to ensure cost effectiveness and fill gaps to reduce logistics costs.

So after discussing with stakeholders, we prepared an integrated coal logistics plan and after superimposing ongoing railway and coal mines projects, identified gaps in coal transportation. We have highlighted these gaps and duly informed the railway ministry.

As of now, 13 rail projects are going on to augment railway infrastructure (for carrying coal), in Odisha, Chhattisgarh and Jharkhand. Three of them are complete, while all 13 will be complete by 2025. Once this is done, the trunk rail infrastructure will be expanded for coal evacuation.

For these 13 projects, Coal India Limited (CIL) has pooled in its resources with the railway ministry and invested Rs 15,000 crore in collaboration with IRCON, and results have been satisfactory.

However, since many new coal mines are coming up and several of them have been given to private operators, we have identified gaps and around 26 new railway project proposals have been shared with the railway ministry, which has incorporated them in its annual plan.

Q: When will these 26 railway projects be complete?

A: These 26 projects have been phased as per our immediate requirement as well as for future use.

With this, both the coal and railway ministries have now completed their planning for infrastructure needed to meet coal evacuation requirements until 2047, based on the principles of PM GatiShakti.

Q: Of these 26 projects, which are critical?

A: Around 10 are critical, to be completed on priority within the next three years. These projects will fulfil trunk connectivity requirements of coal transportation.

Q: Can you elaborate on first-mile connectivity projects?

A: For ensuring first-mile connectivity, coal and railway ministry subsidiaries are working jointly to build spur lines and sidings from main railway lines to coal mines. This work is being funded by CIL and the construction work is being done by railway ministry subsidiaries.

The second aspect is to transport coal from mines to loading points. As of now, this is being done by trucks, which entails high costs and leads to pollution.

We have made a plan, wherein in our 67 larger mines, which produce more than 2 million tonnes of coal, the dry fuel will be loaded from the production point and transported on conveyor belts to railway wagons.

Of these 67 projects, we have rolled out eight, 27 will be rolled out this year and during the next fiscal, while the remaining will be rolled out by 2026. The total cost of these first-mile projects will come to Rs 13,000 crore.

Q: The coal ministry also plans to diversify and set up thermal power plants. What exactly is the roadmap?

A: The power ministry plans to set up some more thermal plants in the country, and since we have coal, land and water, the coal ministry has decided to build three pithead thermal power plants.

One of these will be set up in Talabira in Odisha, to be built by Neyveli Lignite Corporation (NLC), with a capacity of 2,400 megawatt. The second will be Mahanadi Basin thermal power plant in Odisha, which will also generate 2,400 MW and will be developed by Mahanadi Coalfields Limited (MCL).

The third thermal power plant will be at Amarkantak, in collaboration with the Madhya Pradesh government. South Eastern Coalfields Ltd and Madhya Pradesh Power Generating Company Ltd will jointly execute this project, which will be a 660 MW plant.

All the three projects are in advanced stages of initiation and de-coaled land (land where a mine has closed down) is being identified for them.

Q: How are the commercial coal mines auction plans progressing?

A: Though we have a huge reserve of mines, we have found that those mines where there are difficulties like connectivity issues, and which have dense habitations around them or are of a large size, don’t find any takers. So we have done a comprehensive exercise for all our mines and determined that 44 will find takers, while 54 may not find buyers.

For the 44 accessible mines, we have asked to insert a drone video in their dossiers while offering them for auction, in order to give an idea of their topography to prospective bidders. A final dossier for these 44 mines will be created by 15 September.

Once this is done, the eighth round of auctions will be conducted by end-September, when around 50 mines will be put up for auction, which will include the 44 accessible mines.

Q: Does the ongoing auction process also include those 204 mines whose allocation was cancelled by the Supreme Court in 2014?

A: The 204 mines were those which had been auctioned by the coal ministry as of 2014, and irregularities were found in them. So when the question of auction arose for those mines (whose allocation was cancelled by the SC), we drafted the Coal Mines Special Provision Act.

In addition, we had several other blocks which were not among these 204 reserves. These are called Mines and Minerals Development and Regulation (MMDR) Act blocks. Both these sets of blocks are being parallelly auctioned. So the 92 blocks which we have auctioned until now in seven rounds include both these sets of coal reserves.

Of the 204 blocks, there are several which we have offered for auction, but have not found any takers as many of them have deep forest and difficult terrain. So we are identifying new areas, where there are fewer challenges, and are getting them drilled to create new mines with the aim of offering them for auction.