The first round of coal block auction under new rules will be delayed. The deadline for this round was April 30.
The Coal Ministry says the allocation would take more time because it is yet decide on a few parameters such as the reserve price of the blocks.
On offer are 17 mines to Central and State public sector undertakings under Auction by Competitive Bidding of Coal Mines Rules, 2012.
“The issues are being discussed with the Finance Ministry. It would take some more time,” said senior official in the Coal Ministry handling the allocation process.
He, however, did not give any new time line when the first set of allocations may be completed.
The Government is offering these blocks without charging reserve price (the minimum cost to be submitted by the firm getting the block). This is because the blocks are not fully explored and therefore, potential reserves are not known.
Nearly, 316 companies (235 from power sector; 38 are other miners) applied for these blocks with estimated 8.5 billion tonnes of coal reserves.
Of the 17 blocks on offer, 14 are for captive use for power sector. The remaining three blocks — Talcher, Auranga, and Korba — are for mining.
Industry watchers feel that the Government was sceptical of allotting new coal blocks after the earlier processes were questioned.
“The risk of parliamentary, judicial and regulatory review of coal block allocation remains high. Mass de-allocation or rebidding is also possible given the 2G spectrum experience,” said Salil Garg, Director (Corporates) at India Ratings & Research.
On April 23, the Parliamentary Standing Committee on Coal and Steel recommended a probe into the “decision-making process” for distribution of coal blocks from 1993 to 2010. It also said that all coal blocks allotted, at least where coal production has not begun, should be cancelled immediately.
The Standing Committee’s recommendation brings more pressure on the Centre, already in trouble over Law Minister Ashwini Kumar’s alleged attempts to influence CBI’s status report on the coal block scam investigation, submitted to the Supreme Court.