India’s UltraTech Cement, ACC Cement and Reliance Cement are amongst the prospective bidders for the auction of 27 coal blocks.
To attract investors, the government has allowed the sale of up to half the output to Coal India at a notified price, while a further 25 per cent can be sold in the open market. However, block operators have to consume at least 25 per cent of their produce in their own plant, according to The Economic Times. The Coal Ministry has also increased the time limit for operationalising the mines to five years from four years.
Out of the 27 blocks, 19 are Schedule III mines, meaning they are ready to produce with almost all clearances and plans in place. One is a Schedule II mine, which was already producing when it was taken back by the government. Collectively, these 20 mines are estimated to hold an extractable reserve of 1bnt and can produce 36Mta. The rest of the blocks on offer are Schedule I mines, which have only been explored with rough estimates of reserves and require further work before production in these mines can begin.
Financial bidding is scheduled between 10 October-8 November, while final allotment is likely to be given by 11 November.
