New capacity in coal sector in India during 12th plan

Wednesday, 21 Dec 2011

Mr Pratik Prakashbapu Patil minister of state in the ministry of coal informed the Lok Sabha that the government proposes to add new capacity by way of taking up of new projects as well as expansion of existing projects through Coal India Ltd and its subsidiaries, Neyveli Lignite Corporation Ltd and Singareni Collieries Company Ltd in Public Sector. Further, new capacity addition in production through coal block allocatees both Public and Private Sector is also envisaged.

It is envisaged that during the 12th plan period the annual production of coal will increase from 447 million tonne to 615 million tonne by CIL, from 51 million tonne to 57 million tonne by SCCL and for lignite it is envisaged to increase from 41.64 million tonne to 68.60 million tonne by NLC by way of capacity addition. The production from coal block allocatees is envisaged to increase from 36.15 million tonne to 100 million tonne during the above period.

The minister further added that as per the recommendations of the Working Group on coal for the 12th Five Year plan (2012-2017), the capital outlay for Coal and Lignite sector during the above period is envisaged as under:

Coal India Ltd INR 25400 crore
Singareni Collieries Company Ltd INR 10350 crore
Neyveli Lignite Corporation Ltd INR 3481 crore

New Mining Bill tabled in Lok Sabha

Monday, December 12, 2011

New Delhi: The Mines Ministry today tabled the new Mining Bill in Lok Sabha proposing coal miners to share 26% of the profit and non-coal miners' 100% of the royalty annually to project-affected people.

The Mines and Minerals (Development and Regulation) Bill, 2011, which will replace the over-a-century old, often-amended Act of 1957, also seeks to empower state governments to constitute special courts for the purpose of providing speedy trial of offences relating to illegal mining.

"The holder of a mining lease shall pay annually to the District Mineral Foundation...In case of major minerals [except coal and lignite] an amount equivalent to the royalty paid during the financial year," the Bill proposes.

"...In case of coal and lignite, an amount equivalent to twenty six% of the profit...In case of minor minerals, such amount as may be prescribed by the State government with the concurrence of the National Mining Regulatory Authority," it added.

The long-pending Bill also envisages introduction of competitive bidding process to encourage participation of private parties and a change in the role of the central and state governments, particularly to incentivise them for investing in exploration and mining.

The Mines & Minerals (Development and Regulation) Bill, 2011 provides for a simple and transparent mechanism for grant of mining lease or prospecting licence through competitive bidding in areas of known mineralisation, and on the basis of first-in-time in areas where mineralisation is not known.

(sourced Business Standard)

Indian Iron ore export policy, iron ore of Fe content upto 64% is freely allowed

Update on export of iron ore

Thursday, 01 Sep 2011

Mr Beni Prasad Verma minister of steel has said that as per the present export policy of government of India, export of all iron ore of Fe content upto 64% is freely allowed.

In a written reply in the Lok Sabha today he said that ministry of steel has not received any complaint regarding difference between the quantity of the iron ore that was exported and the quantity for which mines department of the state government had granted permission.

Indian investment in Hajigak iron ore mine in Afghanistan

Saturday, 27 Aug 2011

Mr Dinsha Patel minister of state for mines informed the Lok Sabha that the government of Afghanistan had invited offers for commercial exploitation of Hajigak Iron Ore Deposit through the process of competitive bidding.

The ministry of mines convened a meeting of Indian mining companies, both private and public sector, on January 6th2011 and requested them to participate in the Expression of Interest.

The ministry of steel thereafter held a series of meetings to address the concerns expressed by the companies. The last date for bidding is September 4th 2011. The final decision of participation in the competitive bidding process, is a commercial decision of the individual companies.

Update on Indian royalty rates of non prime minerals

Saturday, 27 Aug 2011

Mr Dinsha Patel minister of state for mines informed the Lok Sabha that there is no classification of minerals as non-prime minerals in the Mines and Minerals (Development and Regulation) Act 1957 (MMDR Act) and Rules framed there under.

However, Section 9 of the MMDR Act provides that a mining lease holder shall pay royalty in respect of any mineral removed or consumed from the leased area at the rate for the time being specified in the Second Schedule of the MMDR Act and the royalty rates of minerals may be revised upwards only once in three years. During the last ten years, the royalty rates in respect of major minerals (other than coal, lignite and sand for stowing), have been revised in the years 2000, 2004 and 2009.

Indian government update on land for mining to private companies

Monday, 14 Mar 2011

Mr Dinsha Patel Indian minister of state (independent charge) for mines informed the Lok Sabha that the state governments are competent to grant mineral concessions including Reconnaissance Permit, Prospecting Licence and Mining Lease under the provisions of the Mines and Minerals Act 1957 subject to prior approval of the central government.

Subsequent to the prior approval of the central government, mining leases etc are executed by the state governments with the mining agencies after following the due procedures ie obtaining forest and environment clearances and approval of mining plan from the Indian Bureau of Mines.

Whilst processing the proposals recommended by the State Governments for prior approval of the Central Government, the Ministry of Mines examines the same in the light of the provisions of the MMDR Act, 1957, the Mineral Concession Rules, 1960 and the guidelines framed in this regard and where necessary, in consultation with the State Governments and specialized agencies like the Indian Bureau of Mines, the Geological Survey of India and the Department of Atomic Energy. The Ministry of Mines is conscious of its responsibility to ensure that the mineral concession regime functions in a transparent and efficient manner. In this regard, the Ministry has, in consultation with the State Governments, issued the following guidelines:-

1. Comprehensive guidelines dated June 24th 2009, in order to bring more clarity in processing the mineral concession proposals. The guidelines also seek to ensure application of uniform criteria by the State Governments while examining and recommending proposals to the Central Government.

2. Guidelines dated February 9th 2010 on ‘special reasons’ to be adopted by all State Governments while recommending a mineral concession proposal in favour of a later applicant in a non notified area.

3. Guidelines dated October 13th 2010 regards maps in order to ensure that the areas recommended by the State Governments for mineral concessions are clearly demarcated.

India to face huge coal shortage by 2021-22

New Delhi, Mar09, 2011

The Government today admitted that the country will face a huge shortfall of 269 million tonnes of coal by 2021-22 as the coal producing entities have failed to keep pace with the demand as well as economic growth.

“In the last 8-10 years, the economy grew at a much faster pace compared to coal production even as the Coal India Ltd registered a growth of 7-8 per cent. We are trying to adopt different technologies which are more efficient in coal usage to meet the demand,” the Coal Minister, Mr Sriprakash Jaiswal, said in the Lok Sabha during Question Hour.

According to estimates, demand for coal in 2021-22 is projected at 1,353 mt against the production assessment at 1,084 mt, leaving a shortfall of 269 mt.

“In view of the widening demand-supply gap of coal, the country is unlikely to become self-reliant in meeting the demand of coal indigenously in the near future,” Mr Jaiswal said.

He also informed the House that several states were allocated coal blocks more than five years ago but

they are yet to begin production.

Chhattisgarh was allocated nine coal blocks more than five years ago, Maharashtra was given seven blocks and Madhya Pradesh 10 blocks, he said adding that unfortunately production has not begun at any of these blocks.

Replying to a supplementary on whether irregularities in allocation of coal blocks have come to the notice of the Government, Mr Jaiswal replied in negative. He also said that now coal blocks are allotted only through competitive bidding and there was no possibility of any wrongdoing.

In view of India producing only 10 per cent of good quality coal, it has been placed under Open General Licence scheme so that industries such as sponge iron, steel and power producers could import good coal according to their demand.