Coal India Ltd may soon revive its proposal for extraction and commercial utilisation of nearly 25 billion cubic metres of coal-bed methane (CBM, also known as coal seam gas) from five gassy mining assets in Jharkhand, through private participation. The coal major was previously forced to put the proposal on the backburner in the face of a turf battle between the Union Ministries of Coal and, Petroleum and Natural Gas.
Backed by the coal ministry, CIL invited bids from CBM operators in April-May this year for commercial exploitation of the gas and ensure fast and safe mining of over 100 million tonnes of medium grade coking coal. However, the tender could not be closed in the face of opposition from MoPNG, which claimed authority over commercial utilisation of CBM resources inIndia.
Project cleared
According to sources, after a series of meetings, the two ministries have recently decided clear the ground for the project.
Sources suggest the petroleum ministry has apparently agreed to coal ministry's logic that the CBM Policy does not include the CIL leasehold area. Also, as per the Mining Act there was no space for a second “licensee” in a particular mining leasehold area.
Similarly, the coal ministry has agreed that the contracts for CBM extraction should not be awarded without requisite “price approval” from the designated authority under the petroleum ministry.
Climbing down from its earlier stance, the coal ministry is now working on a proposal to seek cabinet nod for the CIL initiative with tacit approval from the petroleum ministry.
Background
Even though it is a source of energy , high concentration of methane (CBM) impacts safe mining operations. Accordingly, underground mining in the five identified mines — Munidih (8 bcm), Kathara (8 bcm), Asnapani (6 bcm), Putki Buliwari (7 bcm) and Mohuda (0.4 bcm) is considered unsafe by the Directorate of Mine Safety.
Since release of this greenhouse gas in the environment has its own pitfalls, the only solution available to CIL is extracting the gas in a fast track manner (preferably within 3-4 years). However, considering the high investment required in such degasification (much higher than normal CBM operations) the viability of project would depend on commercial utilisation of the gas.