Monday, December 13, 2010

The Government allocates coal blocks through set procedures in a transparent manner. The different procedures followed for allocation of coal blocks are:

- Government Company Dispensation Route – Under this arrangement, applications are invited from the State Government/Central Govt. companies/enterprises. Allocation of coal blocks to State/Central Public Enterprises (PSEs) is made under Section 3(3)(a)(i) of the Coal Mines (Nationalisation) Act, 1973. Under this route, only government companies are allocated coal blocks and no private company is eligible for allocation.

- Captive Dispensation Route – Under this dispensation, coal blocks identified for allocation for approval end-use for captive mining are advertised in the major National/Regional newspapers calling applications from both public and private sector companies. The applications received are placed before a Screening Committee for its recommendation. Allocation of coal blocks in favour of public as well as private sector companies under Section 3(3)(a)(iii) of the Coal Mines (Nationalisation) Act, 1973 is done by the Government based on the recommendations of the Screening Committee which is an inter-ministerial and inter-governmental committee headed by Secretary(coal). This Committee has representatives from Ministry of Power, Steel, Industry, Environment & Forests, Railways, Coal India Limited, Central Mine Planning & Design Institute Limited, Neyveli Lignite Corporation and the concerned State Government where the block is located.

- Allocation of Coal blocks under Tariff Based Competitive Bidding – In this case, identified coal blocks are placed at the disposal of Ministry of Power which determines the linkage of coal blocks with the power projects proposed to be awarded on the basis of Tariff Based Competitive Bidding by calling applications from eligible companies. Coal blocks are allotted by the Ministry of Coal to power projects on the basis of bidding for tariff on the recommendations of Ministry of Power under Section 3(3)(a)(iii) of the Coal Mines (Nationalisation) Act, 1973.

Coal/lignite blocks to eligible private sector companies are allocated for generation of power, production of iron & steel, production of cement and production of syn-gas through coal gasification (underground and surface) and coal liquefaction.

This information was given by the Minister of State for Coal (Independent Charge) Shri Sriprakash Jaiswal, in a written reply to a question the Rajya Sabha today.

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