Coal news and updates

Govt sets riders for bidders with coal linkages

November 20: The government, while allowing companies with coal linkages or those whose linkage applications are pending, to participate in the bidding for any Schedule II mine, has, however, set some riders, as per the Coal Mines (Special Provisions) Rules, 2014.

The quantum of linkage coal will reduce correspondingly if the holder is a successful bidder.

The rules specify that a company engaged in specified end-use, including a company having a coal linkage or whose application for linkage is pending with the central government on the date of commencement of the Ordinance, shall be eligible to bid for any Schedule II coal mine provided it has made an expenditure of 80% of the total project cost of the specified end-use plant(s).

The rules further elaborate that a company engaged in specified end-use, including a company having a coal linkage or whose application for linkage is pending with the central government on the date of commencement of the Ordinance shall be eligible to bid for any Schedule III mine, provided it has made an expenditure of 60% of the total project cost of the specified end-use plant(s).

The government has clarified that if such a company is the successful bidder, then the entitlement to receive coal pursuant to such linkage shall stand proportionately reduced on the basis of the requirement of coal being met from the mine allocated to such company.