Successful bidders of coal block in the e-auctions would need to provide a bank guarantee equal to the aggregate of one year royalty and the annual peak rated capacity of the mine multiplied by winning bid amount.
The provisions are part of the Coal Mine Development and Production Agreement released by the Government on Friday.
“The successful bidder shall conduct mining operations at the coal mine in accordance with the milestones or ‘Efficiency Parameters’. Failure to comply would result in reduction of the Performance Security in the manner that has been defined in the Coal Mines (Special Provisions) Rules, 2014,” said Vivek Bharadwaj, Joint Secretary, Coal Ministry. Bharadwaj is also the Nominated Authority of the coal block e-auctions.
Apart from furnishing the bank guarantee, payment of the upfront amount needs to be made in three instalments by the successful bidders.
The successful bidder will also have to comply with applicable laws related to health, safety, welfare, social security and minimum wages for the workers, Bharadwaj said.
To monitor the compliance with the efficiency parameters, the bidders will report periodically about various stages of mining to the Nominated Authority and State Governments.