A reference needs to be made for a quick policy review on coal bed methane -CBM, so that, when the coal blocks are allotted, it is imperative for the allottees to plan work on simultaneous extraction of CBM, when they start the mining operation

In line with the Supreme Court directives, the coal blocks will now be auctioned and the tender documents are expected to be announced on 22^nd December. The actual auction process is expected to commence on 11^th February and close by 15^th March so that this matter can be set to rest. Earnest work on the blocks will start later, once other matters relating to environment and forest clearances are obtained.

In the meantime, the Coal Ministry has proposed a minimum floor price of Rs100 as reserve price for State and Central government enterprises and Rs150 for the rest, when these coal blocks are put up for auction. A Cabinet note, circulated by the Ministry is likely to be taken up on Wednesday, 10 December 2014. Depending upon the grade of coal, which varies from block to block, the final floor price will be determined.

The lowest grade of coal with a rating of 2,200/2,500 Kcal/Kg is available at about Rs550 per tonne and the highest grade at 6,200/7,000 Kcal/kg is priced at Rs5,000 per tonne.

These are based on the Coal India notified price for different types/grades of fuel.

Generally, the power sector uses 5,900 Kcal/kg (gross caloric value) and it is sold around Rs2,590/2,800.

Earlier, 74 blocks were earmarked for auction, but now, 18 more have been added to make a total of 92, as per Coal Secretary, Anil Swarup. The mining plan for these 18 blocks has been approved and they have the potential to produce 100 million tonnes per year. However, environment clearance is not there yet.

The tender document is likely to be released on 22^nd December and the auctions are scheduled to start on 11th February and be completed by 15^th March 2015. Mines would be allotted on a priority basis to specified end users; out of 92 blocks in the first phase, 57 would be given to power sector. Of these 34 may be earmarked for Central and State power sector undertakings.

While attending a workshop organized by the Federation of Indian Chambers of Commerce of India (FICCI), Anil Swarup was speaking to the press when he is reported to have made these statements. He conveyed that the Ministry was also working on setting up an electronic platform where, he said, "we will house all the problems and then take it up with the stakeholders". This platform is likely to be operative in the next ten days.

This electronic platform is expected to include all matters relating to land, delays in obtaining forestry and environmental clearances, among others. Expeditious handling and clearances, or even waivers, to these blocks would enable the stakeholders to get on with the job of mining operations with least delay.

It is in this connection, a reference need to be made for a quick policy review on Coal Bed Methane (CBM), so that, when these coal blocks are allotted, it is imperative for the allottees to plan work on SIMULTANEOUS extraction of CBM, when they start the mining operation.

Several countries like the US, Australia have the expertise in this area, and it may be worthwhile for the successful bidder to invite qualified consultants/partners to assist them to tap CBM which will go waste, otherwise!

(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)