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Thursday, 25 June 20
ALL YOU WANT TO KNOW ABOUT COAL MINE AUCTIONS - THE HINDU BUSINESS LINE
Last week, Prime Minister Narendra Modi threw open the auction of 41 coal blocks for commercial mining. The decision, which was part of the announcements made by the Centre under the Atmanirbhar Bharat Abhiyan, was already proposed in January through the Mineral Laws (Amendment) Ordinance, 2020.
What is it?
These auctions invite participants to mine coal blocks by bids on the percentage value of coal sold that they will be willing to share with the government. Successful bidders will obtain leasing rights from State governments to mine a coal block for a certain period.
What’s new about the recent auction of 41 coal blocks is that this is the first time private players have been allowed to mine coal for commercial mining purposes, without any end-use restrictions. That is, unlike now, mined coal can be sold outside. There is no requirement that it should be used only for the firms’ own consumption.
India has a long history of commercial mining, for about 200 years starting from 1774. In the second half of the 20th century, the government took note of the inadequate capital investments from private players to meet the burgeoning energy needs of the country. Some private coal miners were found to be using unscientific coal mining practices and providing poor working conditions for labour. This led to the Central Government taking a decision to nationalise private coal mines. The nationalisation was done in two phases, from 1971-1973. That’s how the Coal Mines (Nationalisation) Act, 1973 was enacted, which restricted coal mining operations mainly to government entities.
The recent decision to allow private firms to participate in the bidding process with a reduced upfront amount, the facility of adjustment of upfront amount against royalty, liberal operational efficiency parameters, and 100 per cent FDI through automatic route is a watershed moment for India’s energy industry. Further, allowing a revenue-sharing basis (a percentage of revenue share (final bid) has to be paid to the government on the sale of coal) as against the current mechanism of paying fixed rupee per tonne, may also encourage private players to take participation in the auction process.
Why is it important?
Despite India being the world’s fourth-largest country in terms of availability of coal reserves, we still import around 240 million tonnes (mt) of coal a year valued at about ₹1.7 lakh crore. Almost the entire requirement of coking coal, a key raw material for steel, is imported as the domestic availability of high-quality coking coal is limited. According to the Coal Ministry, the 41 mines opened for auction now can hit a peak production of 225 mt in 2025-26, saving precious foreign exchange.
The High Powered Expert Committee formed in 2017 to examine the efficacy and challenges in coal mining auctions recommended a gradual shift from the allocation of coal blocks for own consumption to allocation of blocks for commercial mining. It expected that commercial mining of coal would help tap the locally available reserves and increase the availability of coal in the Indian market at a cheaper price making us less dependent on imports.
Why should I care?
On launching the auction of 41 coal blocks last week, the Prime Minister said that coal would be brought out “after decades of lockdown” and private sector involvement would help realise ₹33,000 crore of capital investment in the next five years. Should private investments flow in, it can give a leg up to the economic activity within the country and play an important role in job and income creation.
In addition, higher production and surplus availability of coal may lead to fall in its prices, which may reduce the cost of electricity consumed by the households and industries. Currently, coal-fired plants generate about 70 per cent of India’s electricity.
But weighed against this, is the question of is whether this has this move come a little too late in the day, and will it see enthusiastic bidding? India’s energy mix is already shifting towards cleaner renewables, the cost of producing power through cleaner routes has been falling and global players are shying away from polluting fuel.
The bottomline
Its a fine balance between short-term cost savings and long-term environmental impact
A weekly column that puts the fun into learning
Source: Satya Sontanam | The Hindu Business Line
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Monday, 29 June 20
CHINA COAL IMPORT OUTLOOK: MANY MOVING PARTS, FORECAST TO FALL 10% YOY - GHEE PEH | IEEFA
China’s coal demand declined in the first quarter of 2020. According to the China National Coal Association, the country consumed 870mt in th ...
Monday, 29 June 20
ULTRAMAX: A 58,000 FIXING DELIVERY SINGAPORE TRIP, VIA EAST COAST INDIA, REDELIVERY CHINA IN THE LOW $12,000S - BALTIC BRIEFING
Capesize
As the halfway mark of 2020 arrives, the capesize market is making new highs for the year. From persistent lows earlier caused by a ba ...
Saturday, 27 June 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Friday, 26 June 20
WHAT TODAY'S BAILOUTS CAN DO FOR TOMORROW'S ECONOMIES - WORLD ECONOMIC FORUM
The COVID-19 crisis provides an opportunity for governments to build fairer, more sustainable and more resilient economies.
Governments a ...
Wednesday, 24 June 20
MARKET INSIGHT - INTERMODAL
The World Bank estimates that the global economy will fall by 5.2% this year, underlining that the Covid-19 pandemic has had rapid and massive cons ...
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Port Waratah Coal Services - Australia
- Ind-Barath Power Infra Limited - India
- Indian Oil Corporation Limited
- Toyota Tsusho Corporation, Japan
- Central Electricity Authority - India
- Singapore Mercantile Exchange
- Videocon Industries ltd - India
- Vedanta Resources Plc - India
- Savvy Resources Ltd - HongKong
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Africa Commodities Group - South Africa
- Uttam Galva Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Madhucon Powers Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- Wilmar Investment Holdings
- PetroVietnam Power Coal Import and Supply Company
- Aboitiz Power Corporation - Philippines
- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- Karbindo Abesyapradhi - Indoneisa
- Sakthi Sugars Limited - India
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Makarim & Taira - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Planning Commission, India
- Jorong Barutama Greston.PT - Indonesia
- Mercuria Energy - Indonesia
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sojitz Corporation - Japan
- Bhushan Steel Limited - India
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Australian Coal Association
- Indo Tambangraya Megah - Indonesia
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- Kideco Jaya Agung - Indonesia
- Vizag Seaport Private Limited - India
- Bangladesh Power Developement Board
- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Energy Development Corp, Philippines
- White Energy Company Limited
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- IHS Mccloskey Coal Group - USA
- Straits Asia Resources Limited - Singapore
- Kepco SPC Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Deloitte Consulting - India
- Banpu Public Company Limited - Thailand
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Indian Energy Exchange, India
- Indonesian Coal Mining Association
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ambuja Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- The Treasury - Australian Government
- Gujarat Sidhee Cement - India
- Latin American Coal - Colombia
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- Australian Commodity Traders Exchange
- SMC Global Power, Philippines
- Sarangani Energy Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMG Consultants - Indonesia
- Antam Resourcindo - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- ICICI Bank Limited - India
- London Commodity Brokers - England
- Maheswari Brothers Coal Limited - India
- Ceylon Electricity Board - Sri Lanka
- Barasentosa Lestari - Indonesia
- Meralco Power Generation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Kapuas Tunggal Persada - Indonesia
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Salva Resources Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Siam City Cement - Thailand
- Eastern Coal Council - USA
- Indika Energy - Indonesia
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Baramulti Group, Indonesia
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- GAC Shipping (India) Pvt Ltd
- Altura Mining Limited, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- San Jose City I Power Corp, Philippines
- Dalmia Cement Bharat India
- South Luzon Thermal Energy Corporation
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- Goldman Sachs - Singapore
- Binh Thuan Hamico - Vietnam
- Meenaskhi Energy Private Limited - India
- Renaissance Capital - South Africa
- Iligan Light & Power Inc, Philippines
- Edison Trading Spa - Italy
- Marubeni Corporation - India
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Indogreen Group - Indonesia
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- GVK Power & Infra Limited - India
- Bharathi Cement Corporation - India
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Kaltim Prima Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- Sree Jayajothi Cements Limited - India
- IEA Clean Coal Centre - UK
- Attock Cement Pakistan Limited
- Lanco Infratech Ltd - India
- Global Business Power Corporation, Philippines
- Carbofer General Trading SA - India
- Standard Chartered Bank - UAE
- Mjunction Services Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Finance - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Coalindo Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Economic Council, Georgia
- GMR Energy Limited - India
- The University of Queensland
- Riau Bara Harum - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Grasim Industreis Ltd - India
- Commonwealth Bank - Australia
- Manunggal Multi Energi - Indonesia
- Coal and Oil Company - UAE
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- Sindya Power Generating Company Private Ltd
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Alfred C Toepfer International GmbH - Germany
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Intertek Mineral Services - Indonesia
- TeaM Sual Corporation - Philippines
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Chamber of Mines of South Africa
- Bhatia International Limited - India
- Jaiprakash Power Ventures ltd
- Thiess Contractors Indonesia
- PTC India Limited - India
- Trasteel International SA, Italy
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Sical Logistics Limited - India
- European Bulk Services B.V. - Netherlands
- ASAPP Information Group - India
- Semirara Mining Corp, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Merrill Lynch Commodities Europe
- Power Finance Corporation Ltd., India
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- Mintek Dendrill Indonesia
- Kobexindo Tractors - Indoneisa
- MS Steel International - UAE
- International Coal Ventures Pvt Ltd - India
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