The first round of coal block e-auction, which ended after an aggressive bidding on 21 st February, saw some key names of the industry bagging 18 mines with a combined extractable reserve of 90 million tonnes, along with attached end-use infrastructure. According to the auction amount and royalty payable, it was a windfall of close to Rs 1 lakh crore for six mineral-rich states over the next 30 years. On the other hand the Non-mineral-rich states will benefit from tariff concessions, or reduction in power rates arising out of stiff bidding for coal. By the coal ministry's rough estimates, for every decline of Rs 100 a tonne in a bid, the power rate gets reduced by 6 paise a unit.
Of the 18 operational blocks that went under the hammer, seven were kept aside for the power sector and the rest for unregulated sectors like iron, steel and cement. While there was reverse bidding for power sector end-use, it was forward bidding for the unregulated sectors. Some of the earlier owners of coal mines - Hindalco, Balco, Jindal Steel & Power (JSPL), GMR and CESC - bagged most of the blocks.
However, at least thirteen companies that had invested hugely in end-use plants could not regain possession of the blocks previously held by them. Initially, 23 operational mines were earmarked for first phase of e-auction but due to the intervention of Delhi High court in case of two blocks and lack of bidders’ interest in other two, only 18 blocks were eventually put up for auction. The next tranche of coal block to go under the hammer would be the 20 near-operational mines in Schedule III which originally consisted of 32 blocks.
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