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Captive coal production inches up 2.3% in April-May

FE Bureau

Coal production from captive mines in the first two months of the ongoing fiscal have increased by 2.3% year-on-year to 4.12 million tonnes (MT) from the corresponding period in FY19. However, as many as 13 of the 29 allocated blocks remain stranded due to local agitations, lack of clearances from the appropriate authorities, inadequate transportation infrastructure and conflicts with mining contractors. Output has increased in 12 coal blocks, which includes three mines which were not producing any coal in April-May 2018.

The 29 coal blocks comprise 13 auctioned and 16 allotted mines to government companies. Production in four captive coal mines—allocated to Hindalco Industries, Rajasthan Rajya Vidyut Utpadan Nigam (two blocks), Jaiprakash Power Ventures and NTPC — have actually dipped in these two months.

In the wake of rising demand, the Union coal ministry recently held a meeting with the present owners of these coal blocks and expressed its concerns about falling production in a number of mines. According to minutes of the meeting reviewed by FE, no one attended the meeting on behalf of NLC India to explain why the Talabira coal blocks—which have the largest peak rated capacity among these mines—are yet to begin production.

Captive coal mines produced 25.1 MT of the fuel in FY19. Though this figure is 55% higher than FY18, it is still much lower than the peak output of 43.2 MT in FY15, when 42 blocks were operational. The Supreme Court, in its September 2014 order, had cancelled 204 captive coal block licences, saying that these had been allocated in an illegal and arbitrary manner.

The government has deducted Rs 832.53 crore from the performance security of the captive coal mine-owning companies which did not meet efficiency parameters till FY19, coal minister Pralhad Joshi recently said in a response to a question tabled in Parliament.