The government will soon do the first auction of a one year contract on coal which will not be linked to any end use requirement.
This according to union minister for power, coal, RE and mines, Piyush Goyal will be the government’s first step towards commercial availability of coal.
While Goyal said the this first of its kind auction will take place within the current fiscal, sources in the know said the timing of this auction could be as early as next 2-3 months.
However with coal prices being low in international markets, the government does not feel that it is time yet to bid out mines.
“We will wait for the correct time to invite players for commercial mining,” said a senior government official.
Cutting down on India’s coal imports thereby savings billions of dollars of forex outgo every year, state-owned Coal India has sufficiently ramped up coal production and is currently sitting in a surplus state.
Most thermal power plants in India have atleast a 20-25 days of coal surplus from a situation of coal shortages or critical coal stocks at power plants.
Coal secretary Anil Swarup told EnergyInfraPost in a recent interview that following a surge in the country’s coal production and its sufficient availability, India is all set to export coal for the first time (by around 2-3 million tonnes) to Bangladesh.
The government has set a target of 724.71 million tons for CIL in the current financial year.
The coal ministry is now waiting for demand to pick up before it opens up the sector for private commercial mining, which will allow producers to trade in the fuel, in competition with state-controlled CIL.