File No.22/Prospects of Dev. of Captive Coal Blocks 1 Prospects of Coal Block Development to meet the target

File No.22/Prospects of Dev. of Captive Coal Blocks 2 PREAMBLE

File No.22/Prospects of Dev. of Captive Coal Blocks 3 Coal Mines (Nationalisation) Act passed by the Parliament in As per this Act, Coal Mining could be done only by: –a) Central Govt., or a company, or a Corporation owned, managed or controlled by Central Govt. –b) A person to whom a sub-lease has been granted by any such Govt., Company or Corporation. In 1993 Act was amended and Coal Mining was opened to Companies engaged in : –a) Production of Iron and Steel –b) Generation of Power –c) Washing of Coal obtained from a mine or –d) Such other End-use as the Central Govt. may, by notification, specify

File No.22/Prospects of Dev. of Captive Coal Blocks 4 Based on Sl. No. ‘d’ above, following End-uses added for Captive Mining from time to time. –(i) Cement Manufacture –(ii) Surface Coal Gasification –(iii) Underground Coal Gasification –(iv) Coal Liquefaction (CTL) Decision regarding Coal Washing being an approved End- use not implemented so far. As per the revised policy adopted in Dec’2001, State Govts. & Companies/Undertakings owned by them also authorised to do Coal Mining.

File No.22/Prospects of Dev. of Captive Coal Blocks 5 CURRENT STATUS

File No.22/Prospects of Dev. of Captive Coal Blocks 6 Based on this policy dispensation, 216 Coal Blocks allotted to Public Sector and Private Sector companies and State Govt. Undertakings. This includes following 7 Blocks which were subsequently de-allocated as given below:

File No.22/Prospects of Dev. of Captive Coal Blocks 7 Name of the BlockDate of AllocationDate of De-allocation Utkal ‘A Utkal ‘B1’ Takli Jena Bellora (N) West Umaria Sept’06 Panch bahini6.9.05Sept’06 Jai Nagar Kasta (E) May’09

File No.22/Prospects of Dev. of Captive Coal Blocks 8 S No Name of the CompanyBlock allocatedDate of Allocation Date of De- allocation 1Binani Cement LtdDatima Murli Industries and grace IndustriesLohara (East) Maharastra State Mining Corpn LtdAgarzari Rashtriya Ispat Nigam LtdMahal Rashtriya Ispat Nigam LtdTenughat Jhirki Bhatia International LtdWarora West(NR) Andhra Pradesh Power Generation Corpn. LTdAnsettipalli Andhra Pradesh Power Generation Corpn. LTdPunukula Chilaka Andhra Pradesh Power Generation Corpn. LTdPengedappa Shree Baidyanath Ayurved Bhavan Pvt LtdBhandak (West) National Thermal power Corpn LtdChhati-Bariatu National Thermal power Corpn LtdKerandari National Thermal power Corpn LtdChhati-Bariatu(S) National Thermal power Corpn LtdBrahmini National Thermal power Corpn LtdChichru Pastimal Jharkhand State Electricity BoardBanhardih Damodar Valley Corpn.Saharpur Jamarpani An other 17 Blocks listed below have been deallocated 3 in 2010 and 14 in 2011.

File No.22/Prospects of Dev. of Captive Coal Blocks 9 Out of these, two have been reallocated. As on No. of Blocks allocated stands at 194. Total Geological Reserves in these 194 Blocks mill tons. Sector-wise distribution of these Blocks between Public Sector & Private Sector as on given below:

File No.22/Prospects of Dev. of Captive Coal Blocks 10 Summary of Allocation of Coal Blocks till SectorEnd UseMode of Allotment No of Blocks Geological Reserves (MT) Public Sector Undertaking PowerGovt. Dispensation PowerCaptive Dispensation Sub Total Commercial Mining Govt. Dispensation Iron & SteelGovt. Dispensation Iron & SteelCaptive Dispensation Sub total PSU Total

File No.22/Prospects of Dev. of Captive Coal Blocks 11 Summary of Allocation of Coal Blocks till SectorEnd UseMode of Allotment No of Blocks Geological Reserves (MT) Private Companies PowerCaptive Dispensation PowerUltra Mega Power Project Sub Total Iron & SteelCaptive Dispensation CementCaptive Dispensation Small and Isolated Patch (Commercial Mining) Captive Dispensation 293 Coal to OilCaptive Dispensation Pvt. Total

File No.22/Prospects of Dev. of Captive Coal Blocks 12 Summary of Allocation of Coal Blocks till SectorEnd UseNo of Blocks Geological Reserves (MT) All IndiaPower Iron & Steel Cement Commercial Mining Coal to Oil Grand Total

File No.22/Prospects of Dev. of Captive Coal Blocks 13 Allocation of Mining Blocks started in 1993 and yearwise details of allotment is as under: PowerIron & SteelGovt.Commercial Pvt. Comm.& CementCoal to OilTotal Yr of Allotment Coal Blocks Geological Reserves Coal Blocks Geological Reserves Coal Blocks Geological Reserves Coal Blocks Geological Reserves Coal Blocks Geological Reserves Coal Blocks Geological Reserves ,

File No.22/Prospects of Dev. of Captive Coal Blocks Blocks ie more than 50% of total Blocks allocated as on allocated in 2006 and Peak rated production capacity of mines to be opened in these Blocks assessed at approx. 700 mtpa Following schedule prescribed by Ministry of Coal for commencement of production from the allocated Blocks Opencast Mines: a) Blocks without Forest Cover- 36 months b) Blocks with Forest Cover - 42 months

File No.22/Prospects of Dev. of Captive Coal Blocks 15 Underground Mines : a) Blocks without Forest Cover- 48 months b) Blocks with Forest Cover - 54 months For Blocks not fully explored two years time allowed for completing Exploration As per this schedule more than 70 Blocks should have become operational by now.

File No.22/Prospects of Dev. of Captive Coal Blocks 16 PowerIron &SteelGovt.Pvt Comm & CeemntsTotal YearTarget/Ach No.of Coal Blocks Production (MT) No.of Coal Blocks Production (MT) No.of Coal Blocks Production (MT) No.of Coal Blocks Production (MT) No.of Coal Blocks Production (MT) Target Achvmt Target Achvmt Target Actual Production 36 MT approx Target Actual Production 35 MT approx Target Production targets fixed for the Captive Blocks in the current 5 year plan (11 th plan) is as under

File No.22/Prospects of Dev. of Captive Coal Blocks 17 Target achievement as high as 95% in gone down gradually reaching about 47% and in This level in the current year likely to be only about 35% Counting from for which the figures are available the growth rate of production from captive mining Blocks -less than 2.5%

File No.22/Prospects of Dev. of Captive Coal Blocks 18 ROAD BLOCKS

File No.22/Conference Sept //Presentation 3 (Captive Coal Mining) 19 1.Lack of Expertise- Procedural as well as Technical 2.Delay in Statutory Clearances particularly Forestry and Environmental 3.Land Acquisition 4.Lack of Infrastructural Facilities 5.Lack of Skilled Manpower 6.Lack of Financial Capability 7.Attitude of State Governments.

File No.22/Prospects of Dev. of Captive Coal Blocks 20 While all these factors have contributed to delay in commencement of operations main constraints have been Forestry clearance including that for Exploration, Land Acquisition and Lack of Infrastructure. These could be attended to as follows: Clearances: Prospecting: a)Prospecting license to be issued together with Allocation Order. b)Forest department’s norm of one borehole per sq. km to be relaxed subject to the project proponent giving an undertaking that no trees will be cut for exploration.

File No.22/Prospects of Dev. of Captive Coal Blocks 21 Forestry Clearance: -Forest areas classified as ‘Go’ and ‘No-Go’ by MOEF without any legal mandate -Forestry clearance being denied on untenable grounds like: -Damage to forest cover because of mining will be long term. -This is not correct. Since trees in the entire forest area are not cut at one go. This is done in stages Within 3-5 years of commencement of operations Land Reclamation together with tree plantation starts and within years, full grown replacement Forest is in place. Statistics show that Coal Industry plants on an average 3 to 3.5 trees for every tree that is cut.

File No.22/Prospects of Dev. of Captive Coal Blocks 22 Bio diversity: -It is made out that Bio diversity gets destroyed -This is not correct since the forest area released for mining is only a part of the total forest and the loss of diversity in the area where tree-felling is done gets made up in the regenerated forest through areas over which tree felling has not been done. Sal Forest: -It is made out that Sal forest cannot be regenerated -This is not correct since successful Sal Plantation has been done in mined out areas at certain mines.

File No.22/Prospects of Dev. of Captive Coal Blocks 23 Human beings as much a part of Environment as Forest & Wild life. Not desireable that one is sacrificed for other. Poverty any day a bigger pollutant than temporary loss of Forest. Poverty can be ameliorated only by economic Growth. This growth can be achieved only by ensuring adequate energy availability. Coal most important source of energy in our country. Forestry clearance for coal mining should therefore become more of a norm than exception More stringent conditions can be imposed about regeneration of forest and suitable monitoring mechanism could be set up to ensure compliance. Coal Industry may be asked to pay for the monitoring mechanisam

File No.22/Prospects of Dev. of Captive Coal Blocks 24 Environmental Clearance: Presently it is being granted mine-wise Instead the maximum pollution load that a Coalfield can carry should be assessed and clearance should be given for entire coalfield Meanwhile T.O. Rs could be standardised to save time State Govts. to be pro-active in organising Public Hearing

File No.22/Prospects of Dev. of Captive Coal Blocks Land Acquisition: a)Pressure on Land on account of population b)Intense attachment to land c)Land-cost constitutes very small part of Capital Investment d)Problems in acquisition could be addressed to a large extent by adopting the following: -Land to be taken on Lease/Lease rent to be fixed at least twice the annual income from land. -The mining company should reclaim the mined out area totally including rehandling of external OB Dumps -Reclaimed land should be brought as close to the original as technically possible -Reclaimed land should be returned to the land owners -A lump-sum amount should be paid to the land owners for making the land fit for the usage to which they want to put the land to -Thus loss of land will be temporary and this will eliminate the sense of deprivation that the land owners feel arising out of permanent loss of land.

File No.22/Prospects of Dev. of Captive Coal Blocks 26 Other actions : (i)Provision of employment (ii)Training facilities for making land losers employable (iii)Financing for generating self-employment opportunities & creation of Infrastructural facilities for marketing of produce from such opportunities.

File No.22/Prospects of Dev. of Captive Coal Blocks Lack of Infrastructural Facilities: Captive Coal Blocks generally located in isolated areas. Even areas developed by Coal India were isolated. Coal India could do it since production volume from a Coalfield was large.

File No.22/Prospects of Dev. of Captive Coal Blocks 28 Construction of all facilities individually by each Block Allottee will make the mine unviable. All allottees in a particular coalfield should join hands and develop the facilities. Being tried for Talcher Coalfield in Orissa and Hasdeo Arand Coalfield in Chhatisgarh. Similar approach needed for other major coalfields like North Karanpura in Jharkhand, IB Valley in Orissa & Mand-Raigarh in Chhatisgarh..

File No.22/Prospects of Dev. of Captive Coal Blocks 29 Steps for immediate improvement in production Operating mines should be allowed to produce in excess of the requirement for the concerned End-use plants. Excess coal to be handed over to Coal India at a price midway between the notified price and the ‘e’ auction realisation that Coal India will get by selling this coal. Amendment of Contract Labour (Regulation and Abolition) Act Block allottees should be mandated to extract the Block barrier jointly with the allottee of the adjacent Block

File No.22/Prospects of Dev. of Captive Coal Blocks 30 In large number of cases some sub optimal blocking has been done resulting in situations which militate against scientific mining. The Block allottees should be encouraged to operate such Blocks jointly as a single entity.

File No.22/Prospects of Dev. of Captive Coal Blocks 31 THANKS