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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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Tuesday, 23 June 20
COVID-19 COULD CAUSE A BOOM IN COAL POWER - RYSTAD ENERGY | OILPRICE
COVID-19 has not only impacted the energy industry’s revenues but also its infrastructure development.
The delay of new natural gas ...
Tuesday, 23 June 20
CHINA'S COAL OUTPUT UP 0.9 PCT IN JANUARY-MAY: XINHUA
Output of raw coal in China rose 0.9 percent year on year to 1.47 billion tonnes in the first five months of this year, official data showed.
& ...
Monday, 22 June 20
KAMSARMAX TYPES REGULARLY HIT THE $9,000 PER DAY LEVEL FOR INDONESIAN COAL RUN TO CHINA, BALTIC BRIEFING SAYS
Capesize
The Capesize market trajectory this week has been one of the steepest rallies the sector has experienced. Opening at $12,410, the sect ...
Saturday, 20 June 20
WORLD OIL DEMAND IS PROJECTED TO DECREASE BY 9.1 MB/D IN 2020 - OPEC
Crude Oil Price Movements
Spot crude oil prices rebounded in May from low levels registered a month earlier, as physical market fundamentals im ...
Saturday, 20 June 20
NO ESCAPING GLOBAL TRADE SLUMP - BALTIC EXCHANGE
Those hoping for a decent recovery in trade in the second half of the year should prepare for disappointment.
New data from the Unit ...
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- Indonesian Coal Mining Association
- Meralco Power Generation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Global Business Power Corporation, Philippines
- Eastern Coal Council - USA
- Ambuja Cements Ltd - India
- Indika Energy - Indonesia
- IEA Clean Coal Centre - UK
- Pendopo Energi Batubara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining Corp, Philippines
- Baramulti Group, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- Kepco SPC Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Siam City Cement - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- The Treasury - Australian Government
- Directorate Of Revenue Intelligence - India
- CNBM International Corporation - China
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- Posco Energy - South Korea
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- Energy Development Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Renaissance Capital - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Sidhee Cement - India
- Thiess Contractors Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- The University of Queensland
- New Zealand Coal & Carbon
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Sakthi Sugars Limited - India
- Bhoruka Overseas - Indonesia
- Sojitz Corporation - Japan
- Kapuas Tunggal Persada - Indonesia
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Altura Mining Limited, Indonesia
- Independent Power Producers Association of India
- Star Paper Mills Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bharathi Cement Corporation - India
- Electricity Authority, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- GMR Energy Limited - India
- The State Trading Corporation of India Ltd
- Indian Energy Exchange, India
- Mercuria Energy - Indonesia
- Minerals Council of Australia
- Barasentosa Lestari - Indonesia
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Billiton Holdings Pty Ltd - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- Savvy Resources Ltd - HongKong
- Binh Thuan Hamico - Vietnam
- Commonwealth Bank - Australia
- International Coal Ventures Pvt Ltd - India
- Deloitte Consulting - India
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- Bhushan Steel Limited - India
- Ministry of Finance - Indonesia
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Power Finance Corporation Ltd., India
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Ministry of Transport, Egypt
- South Luzon Thermal Energy Corporation
- Kalimantan Lumbung Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Coalindo Energy - Indonesia
- Ministry of Mines - Canada
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Meenaskhi Energy Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Australian Coal Association
- Global Coal Blending Company Limited - Australia
- Xindia Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Port Waratah Coal Services - Australia
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
- Makarim & Taira - Indonesia
- Sarangani Energy Corporation, Philippines
- Antam Resourcindo - Indonesia
- Energy Link Ltd, New Zealand
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Standard Chartered Bank - UAE
- Sree Jayajothi Cements Limited - India
- Bhatia International Limited - India
- Central Java Power - Indonesia
- Bukit Makmur.PT - Indonesia
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- Parry Sugars Refinery, India
- Semirara Mining and Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- PetroVietnam Power Coal Import and Supply Company
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Marubeni Corporation - India
- Central Electricity Authority - India
- Ind-Barath Power Infra Limited - India
- Bulk Trading Sa - Switzerland
- Larsen & Toubro Limited - India
- Singapore Mercantile Exchange
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- Tata Chemicals Ltd - India
- SMC Global Power, Philippines
- San Jose City I Power Corp, Philippines
- Essar Steel Hazira Ltd - India
- LBH Netherlands Bv - Netherlands
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wood Mackenzie - Singapore
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Heidelberg Cement - Germany
- London Commodity Brokers - England
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- Bayan Resources Tbk. - Indonesia
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- GAC Shipping (India) Pvt Ltd
- McConnell Dowell - Australia
- IHS Mccloskey Coal Group - USA
- Madhucon Powers Ltd - India
- Chamber of Mines of South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Petron Corporation, Philippines
- Mercator Lines Limited - India
- Australian Commodity Traders Exchange
- PNOC Exploration Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Aditya Birla Group - India
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- European Bulk Services B.V. - Netherlands
- Chettinad Cement Corporation Ltd - India
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Coastal Gujarat Power Limited - India
- Lanco Infratech Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Economic Council, Georgia
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Maheswari Brothers Coal Limited - India
- Trasteel International SA, Italy
- Orica Mining Services - Indonesia
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Medco Energi Mining Internasional
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kobexindo Tractors - Indoneisa
- Bangladesh Power Developement Board
- Globalindo Alam Lestari - Indonesia
- India Bulls Power Limited - India
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