Business Standard reported that the new policy would put a price to mining rights for even government-controlled Coal India Ltd.

As per report, the coal ministry has decided to charge CIL a reserve price for the 116 coal blocks allotted

A senior coal ministry official told Business Standard. “We are going to ask CIL to pay a reserve price for all the 116 blocks allocated to the company last month. No reserves would be allocated free-of-cost now,”

The coal ministry official also added that the quantum of the reserve price for CIL would depend on three factors average grade or quality of coal present in the block, location of the acreage and accessibility of the Mining Lease.

The exact details of how the reserve price for coal blocks would be calculated or the quantum of the outgo for the world’s largest coal miner on this account is yet to be worked out.

Coal India had requested the coal ministry for allocation of 138 coal blocks with 57.5 billion tonne reserves in August 2008 to enable its subsidiaries to meet their long term supply commitments. In August 2011, the ministry asked Central Mine Planning and Design Institute of
India to include more blocks in the list. CMPDI indicated eight more blocks after its study taking the total to 146 blocks. In September 2011, Coal India asked for allocation of 116 of these blocks to its subsidiaries. The 116 blocks were last month allocated to CIL by the ministry. A majority of these blocks are yet to be explored. Further, 27 of these blocks are falling in the “No-Go” zones.

Source - Business Standard

(www.coalguru.com)