First Day Of Commercial Coal Block Auction Sees Strong Demand, Vedanta Bullish On Odisha Mine
A front loader loads coal onto a freight wagon at a rail line funded by Coal India Ltd., in Jharkhand, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

First Day Of Commercial Coal Block Auction Sees Strong Demand, Vedanta Bullish On Odisha Mine

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The auction of coal blocks for commercial mining which kickstarted on Monday saw Vedanta Ltd. bidding the highest for a mine in Odisha, while Hindalco Industries Ltd. bid the most for a block in Jharkhand.

Vedanta made the highest bid for Radhikapur West mine at 21% revenue sharing, the coal ministry said in a statement.

Hindalco Industries Ltd. bid the highest for Chakla coal mine in Jharkhand at 14.25% revenue sharing, it added.

With regard to MarkiMangli II mine in Maharashtra, Yazdani International big the highest at 30.75% revenue sharing.

JMS Mining Pvt. Co. bid the highest for Urtan mine in Madhya Pradesh at 10.50% revenue sharing, it said.

For Takli Jena Bellora North and Takli Jena Bellora South block in Maharashtra, Aurobindo Realty and Infrastructure Ltd. made the highest bid of 30.75% revenue sharing.

All the five blocks will generate an annual revenue of Rs 1,556.68 crore for the states, the ministry said.

The blocks put on auction by the ministry generated wide interest from bidders who had submitted their bids for various blocks on offer.

"The technical bids submitted were evaluated and the list of technically qualified bidders was declared. Pursuant to this, Ministry of Coal has commenced the electronic auction of the coal mines for commercial purpose today at 11:00 AM," it said.

Also read: Vedanta, Adani, JSW, JSPL, Hindalco To Bid In Coal Block Auctions From Monday

The first day auction witnessed strong competition, with auction of some of the mines going on for more than three to four hours.

"In all the mines auctioned, the final offer received is above 10% signalling strong demand of coal mines in the market," it noted.

Hindalco, Adani Enterprises Ltd. and Agarwal Mining were also in the race for the Chakla coal block.

In case of Radhikapur (West) coal block, besides Vedanta, Jindal Steel and Power Ltd and two other firms had put in bids.

In June, Prime Minister Narendra Modi launched the auction process for 41 coal blocks for commercial mining, a move that opens India's coal sector to private players, and termed it a major step in the direction of India achieving self-reliance.

The auction of coal blocks for commercial mining is expected to garner Rs 33,000 crore of capital investment over the next five to seven years.

Also read: India May Close Its Dirtiest Coal Plants as Green Focus Grows

The launch of the auction process not only marks the beginning of unlocking of the country's coal sector from the lockdown of decades but aims at making India the largest exporter of coal, the prime minister had said.

Despite being the world's fourth-largest producer, India is the second-largest importer of the dry-fuel.

The coal ministry had later revised the list of mines to be auctioned.

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