Coal news and updates

The coal ministry has begun consultations with other wings of the government on a contentious policy that bars excess production by owners of captive mines, two-and-a-half years after the proposal was shelved by the office of then Prime Minister Manmohan Singh. 

 

Coal Minister Piyush Goyal consented to circulate the draft of the surplus coal policy without any changes in the previous form, a ministry official said. The policy was approved by then Coal Minister Sriprakash Jaiswal in December 2011 and made public on the ministry's website. 

 

But it was put in abeyance by the PMO in January 2012 for further inter-ministerial consultations. The policy has been hanging in balance ever since despite the coal ministry's efforts to get it through. 

 

"We have not made any changes in the draft surplus-coal policy. The policy mandates that any excess production from captive mines due to unforeseen circumstances should be sold to Coal India Ltd at a price lower than production cost," the coal ministry official said. 

 

Power producers and the Planning Commission have been demanding the government to allow captive miners to sell excess production to Coal India at the price the state-run miner sells similar grades of the dry fuel. 

 

This, according to the coal ministry, is illegal as the Coal Mines Nationalisation Act 1973 doesn't permit sale of coal by captive miners. The PMO's intervention in January 2012 followed a tussle between the coal and law ministries in the then Congress-led government over the notification of the policy that is silent on the diversion of excess coal from ultra-mega power projects - projects with at least 4,000 MW of generation capacity. 

 

The law ministry had objected to the policy saying it was in contravention to the government's stand in the Sasan ultramega power project where promoter Reliance Power was allowed to use excess coal from attached mines in another private project. 

 

The law ministry had advised that the policy may land the government in an embarrassing situation and legal trouble. 

 

The coal ministry, in its reply, had told the law ministry that the directive signed by Jaiswal was final and the latter should limit its advice to the issues raised. 

 

 

Source: http://economictimes.indiatimes.com/