Development of Coal Blocks


The Governments of coal and lignite bearing States have been requested to facilitate the development of coal blocks.

Out of 74 coal blocks allocated to government companies, 11 coal blocks have come into production till the end of March, 2010.

Development of coal blocks involves a gestation period of 3 to 7 years for reaching the production stage and another two to three years for reaching the optimal production capacity. As per the guidelines, coal production from a captive coal block should commence with 36 months (42 months incase the area falls in forest land) in case of open cast of open cast mines and in 48 months (54 months in case the area falls in forest land) in case of underground mine, from the date of allocation. If coal block is not explored additional two years are allowed for detailed exploration and three months for preparation of geological report. The allocattees of coal blocks, who have not started production so far, are in various stages of obtaining statutory clearances and mining lease, preparing mining plan, acquisition of land, procuring machinery and equipment etc. for both mining as well as end-use project.

This information was given by the Minister of State for Coal (Independent Charge) Shri Sriprakash Jaiswal, in a written reply to a question the Lok Sabha today.

The Minister said that the responsibility of developing the coal block as per the prescribed guidelines and milestone charge attached with the allocation letter rests entirely with the allocattee company. In the terms and conditions of the allocation letters, it is categorically mentioned that in the event of willful delay in the development of coal blocks and in setting up of the end use projects, the Government takes appropriate action to de-allocate the said block. Government periodically monitors and reviews the development of allocated blocks as well as end use plants by the allocattee companies in the Review Meetings. Wherever delays are noticed, Government issues show cause notices and advisories to such allocattees cautioning them to bring the coal blocks into production as per the guidelines/milestones chart. Further, the allocates have to submit Bank Guarantee which remains valid all the times till the production from the coal block reaches its peak rated capacity. The last review meeting was held on 22nd and 23rd June, 2009 with all the coal block allocattees to review the development of coal blocks and the end use projects. The State Governments have been requested to form a Monitoring Committee headed by the Chief Secretary to facilitate expeditious development of coal/lignite blocks. The Coal Controller’s office is also monitoring on regular basis the achievement of different molestones.

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