At least eight coking coal blocks will be auctioned as India looks to reduce dependence on imported coal and shore up own resources, Jyotiraditya Scindia, Union Minister of Steel, said.
Discussions are on with other countries like Russia, Mozambique and Australia as India continues to explore “alternatives”.
Coking coal is a key raw material in steel-making and India, the world’s second largest crude steel producer, is amongst the largest coking coal importers. Coking coal requirement in India is around 57 million tonnes (mt) and nearly 90 per cent of this is imported.
As per a Ministry document, earnings from tax levied on import of coal stood at ₹1,02,791 crore in FY22.
“In October last year, we signed an MoU with the Russian Federation to make sure we cooperate on the issue of coking coal. We are also looking at other markets like Mozambique and Australia, among others, where we hope to start sourcing and diversifying our coking coal requirements,” he told businessline during an interview.
Coking coal mission
According to Scindia, the mission talks of setting up a coal gasification plant with an annual capacity of 100 mt – which can “ease” the issue through better use of locally available coal. .
Another part of the strategy is to tap different countries for sourcing coking coal while the third strategy is to put up more coking coal blocks for auction, so that the private sector can come in and set up washeries.
“The problem with Indian coking coal is the very high ash content because of which it cannot be used in steel plants. However, the government is working towards a multi prong strategy, a coking coal mission (to take up the issue)....I believe that there are eight mines that are going in for auction, as we speak,” he said.
Coking coal washeries
Coal India, the world’s largest miner, has also been approached to approached to augment coking coal washing capacities to 40 mt.
According to CIL officials, of the washeries planned, two have been commissioned - at Patherdih I (5 MTY) and Dahibai (1.6 MTY), both by Bharat Coking Coal Ltd (BCCL).
Construction completion and commissioning of Madhuband Washery (with 5.0 mtpa) is set for FY22.
Three new coking coal washeries totaling 7 mtpa capacity is planned to be set up by BCCL and 6 washeries in Central Coalfields Ltd (CCL) totalling 18.5 mtpa capacity are also being set up.
“If we are looking at 300 mtpa capacity of steel production in India by 2030-31, then our coking coal requirements too are expected to rise to 160 mt roughly. So definitely, these are the need of the hour,” Scindia added.