Cabinet to re-issue coal ordinance today, discuss auction prices | business | Hindustan Times
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Cabinet to re-issue coal ordinance today, discuss auction prices

business Updated: Dec 24, 2014 00:06 IST
HT Correspondent
HT Correspondent
Hindustan Times
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The Cabinet is likely to take up the proposal for auction of coal blocks on Wednesday, but may reserve the announcement of the auction process, with the Rajya Sabha failing to discuss and approve the Coal Mines (Special Provisions) Bill, 2014 on Tuesday.

The methodology for auction and pricing have been vetted by all stakeholders and responses have been complied, sources in the coal ministry said. However, the Coal Mines (Special Provisions) Bill, 2014, which was earlier passed in the Lok Sabha, could not be taken up in Rajya Sabha. The winter session concluded on Tuesday.

Hence, the Centre may re-promulgate an ordinance to push reforms in the coal sector. The passage of the bill is essential as it would pave the way for auctioning of coal mines, which were cancelled by the Supreme Court. Of the 204 licences cancelled by the apex court, 101 will be put up for bidding for end-use projects in the power, steel and cement industries.

The government needs to issue requests for proposals for 42 mines, currently producing coal, for auction by mid-February. The delay will impact a few power projects that depend on imported coal, as they would not be able to take part in the auction, a coal ministry official said.

The ministry is likely to put before the Cabinet the formula for deciding the bidding price of coal mines. It is proposed to be held in two-stage bidding, with potential bidders submitting their offer price along with technical details to qualify for the next stage. In the second stage, half the qualified bidders will be allowed to participate in the auction, to avoid any windfall gains to a bidder.

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