Coal Min to allot 50 blocks on upfront payments: Sources

The coal ministry is likely to begin block allocation process this week, reports CNBC-TV18 quoting sources. Around 50 block situated in West Bengal, Andhra Pradesh and Jharkhand will be up for grabs by cement, power and steel companies. Also, preference would be given to companies setting up end use projects in the state that hosts the coal block and agree to match the highest bid.

Sources in the know say allotment for steel companies would be via the auction route and there would be a tariff-based bidding for power companies. The ministry has also indicated that about 10-15 coal blocks will go into production next fiscal.

Meanwhile, coal ministry's latest review found that only 29 of 195 allotted coal blocks have started production while progress at 90 blocks was found dissatisfactory as critical milestones like acquisition of land, forest clearances and execution of mining lease were not achieved.

Also, there are around 40 companies that face risk of cancellation of mining licences for their delay in exploration of the coal blocks allocated to them. The ministry will issue show cause notices to companies seeking reasons why they went slow in exploration activities and if a reasonable reply does not come in from them, their licenses would be revoked.

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