Ministry of coal notifies rules for 50 pc sale of coal from captive mines

Earlier this year, the Mines and Minerals (Development & Regulation) Amendment Act had been amended to this effect.

The amendments have been made to allow the sale of coal or lignite, on payment of an additional amount, by the lessee of a captive mine up to 50 percent of the total coal or lignite produced in a financial year, after meeting the requirement of the end-use plant linked with the mine, the ministry said in a statement.

With this amendment, the Centre has paved the way for the release of additional coal in the market by greater utilization of mining capacities of captive coal and lignite blocks, which were being only partly utilized owing to limited production of coal for meeting their captive needs.

"Availability of additional coal will ease pressure on power plants and will also aid in import-substitution of coal," the ministry said

The allowance for the sale prescribed quantity of coal or lignite shall also motivate the lessees to enhance the production from the captive mines.

Further, payment of an additional premium amount, royalty, and other statutory payments in respect of the quantity of coal or lignite sold shall boost the revenue of the state governments, it said.

The ministry said that the move is likely to benefit over 100 captive coal and lignite blocks with over 500 million tons per annum Peak Rated Capacity as well as all coal and lignite bearing States.

The government has also made provisions for grant of mining lease to a Government company or corporation for coal or lignite for a period of fifty years.

"Grant of mining leases for a period of fifty years shall boost seamless continuous production of coal or lignite by the Government companies or corporations contributing to the coal/lignite security of the nation," the ministry said.

The said period of fifty years can be extended by a period of twenty years at a time upon an application made to the State Government, it added.

"Therefore, enlargement of a period of mining leases shall reduce multiplicity of applications for extensions, thereby ensuring continuity in mining operations," the ministry stated.