Coal news and updates

Government mulls common coal trading platform for Coal India and private companies

The government is working on a common coal trading platform for Coal India and private companies which are likely to be offered lucrative blocks with prior clearances for commercial mining.

The electronic platform is likely to be an extension of the spot sale practice of Coal India called 'e-auction' where all the coal mined in the country, excluding from captive blocks, will be traded, a senior government official told ET. "It is too early to talk how the (coal trading) platform would be used but ultimately all coal in the country would hopefully be traded through this platform," the official said.

State-run Coal India sold around 11% of its output through e-auction at a market-driven price in January-March. The government has decided to auction the company's future coal supply to unregulated sectors such as steel, cement and captive power plants.

The proposed platform could trade Coal India's auctioned supplies, the PSU's uncontracted output,  imported coal and the output of private companies from coal mines that will be auctioned for commercial use.

"A common electronic platform will ensure transparent trading, while letting the government record and monitor every single transaction," another coal ministry official said.

The NDA government is working towards auctioning coal blocks for commercial use after enactment of Coal Mines Special Provisions Act that provides for opening the sector to Indian and foreign private firms, ending Coal India's monopoly. Prior to this, Indian companies with end-use plants were permitted to mine coal for captive purposes.

The official said the government is exploring the option to auction coal blocks with upfront regulatory clearances. However, he said some approvals such as forest clearance require the final user to make certain commitments.

source: http://economictimes.indiatimes.com