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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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- Star Paper Mills Limited - India
- Indian Energy Exchange, India
- Heidelberg Cement - Germany
- Indika Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- SMC Global Power, Philippines
- Tamil Nadu electricity Board
- Anglo American - United Kingdom
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- Sindya Power Generating Company Private Ltd
- Krishnapatnam Port Company Ltd. - India
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- White Energy Company Limited
- Georgia Ports Authority, United States
- Cigading International Bulk Terminal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- OPG Power Generation Pvt Ltd - India
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- CNBM International Corporation - China
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Mercator Lines Limited - India
- Ministry of Mines - Canada
- Rio Tinto Coal - Australia
- Indonesian Coal Mining Association
- Jaiprakash Power Ventures ltd
- Thai Mozambique Logistica
- Central Java Power - Indonesia
- Orica Australia Pty. Ltd.
- Goldman Sachs - Singapore
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
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- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- IHS Mccloskey Coal Group - USA
- Binh Thuan Hamico - Vietnam
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- Eastern Coal Council - USA
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
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- Kapuas Tunggal Persada - Indonesia
- Kideco Jaya Agung - Indonesia
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- LBH Netherlands Bv - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Posco Energy - South Korea
- Barasentosa Lestari - Indonesia
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- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- Medco Energi Mining Internasional
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- Tata Chemicals Ltd - India
- Parliament of New Zealand
- PNOC Exploration Corporation - Philippines
- GVK Power & Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- MS Steel International - UAE
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- Economic Council, Georgia
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sakthi Sugars Limited - India
- Videocon Industries ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Bulk Trading Sa - Switzerland
- Bangladesh Power Developement Board
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Sical Logistics Limited - India
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Cement Manufacturers Association - India
- Ministry of Finance - Indonesia
- Salva Resources Pvt Ltd - India
- Standard Chartered Bank - UAE
- Bukit Baiduri Energy - Indonesia
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- ASAPP Information Group - India
- Samtan Co., Ltd - South Korea
- Indogreen Group - Indonesia
- London Commodity Brokers - England
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Semirara Mining Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- Vizag Seaport Private Limited - India
- Energy Link Ltd, New Zealand
- Formosa Plastics Group - Taiwan
- Savvy Resources Ltd - HongKong
- Neyveli Lignite Corporation Ltd, - India
- Africa Commodities Group - South Africa
- Riau Bara Harum - Indonesia
- Aditya Birla Group - India
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- Romanian Commodities Exchange
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Oldendorff Carriers - Singapore
- ICICI Bank Limited - India
- San Jose City I Power Corp, Philippines
- Eastern Energy - Thailand
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- The State Trading Corporation of India Ltd
- SN Aboitiz Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dalmia Cement Bharat India
- Jorong Barutama Greston.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Essar Steel Hazira Ltd - India
- Carbofer General Trading SA - India
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- VISA Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Toyota Tsusho Corporation, Japan
- TeaM Sual Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Manunggal Multi Energi - Indonesia
- Altura Mining Limited, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Baramulti Group, Indonesia
- Vedanta Resources Plc - India
- Global Business Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
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- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- New Zealand Coal & Carbon
- Kumho Petrochemical, South Korea
- Edison Trading Spa - Italy
- Deloitte Consulting - India
- Parry Sugars Refinery, India
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- India Bulls Power Limited - India
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Minerals Council of Australia
- SMG Consultants - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Kepco SPC Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
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- Antam Resourcindo - Indonesia
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- The Treasury - Australian Government
- Borneo Indobara - Indonesia
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