Bhopal:Monday, August 10 : Madhya Pradesh Minister of State for Mineral Resources and Forests (independent charge) Shri Rajendra Shukla has said that coal bearing states should be given first priority in the allocation of coal from coalmines located there for power projects.
They should not be asked to import coal from abroad. Since Madhya Pradesh is a land locked state, the transportation of coal from ports would be very expensive, he added. Shri Shukla insisted that first priority be given to the end users located in the state. In the proposed bidding system, the end user industry of the state has been given price preference of 50 percent. This should be increased to minimum 20 percent for power projects and 10 percent for other end users.
Shri Shukla was addressing a meeting of mining ministers of states convened by the central government to seek their suggestions on the recommendations of the standing committee on mines and mineral resources on Mines and Minerals (Development and Regulation) Amendment Bill, 2008, here today. Union Minister of State for Mineral Resources Shri Shri Prakash Jaiswal attended the meeting. Madhya Pradesh Secretary for Mineral Resources Shri S.K. Mishra also attended the meeting.
Speaking on the provisions of the proposed bill Shri Shukla pointed out that in the draft bill tabled in the Upper House, in section 11 A of the MM(DR) Act, 1957 the power of auctioning of coal blocks vests with the central government. Whereas in the proposed draft MM (SDR) Act, the power of bidding of ore body will be vested with state government. Since the states are the custodian of minerals it would be more appropriate to delegate powers of auctioning with the states. It should also give powers to state government to authorize any government company to conduct bidding on its behalf.
Shri Shukla said that most of the coal bearing areas falls within the forests. Coal block boundaries are demarcated only after carrying out prospecting by central agencies like CMPDIL or MECL or GSI. Valid and scientific technical report like geological information, total reserve, quality and quantity of coal of the coal block should be provided to states free of cost. The states will make payment after completion of bidding process, he added.
The Minister pointed out that the proposed Act, 2009 suggests that before issuing any notification for bidding in respect of forest area, the state government shall obtain all clearances necessary to enable the conduct of mining operations. It has been our long experience that clearances under the Forest Conservation Act 1980 take too much time which causes inordinate delay. For the energy security of the country at least these clearances of coal mines should be streamlined and clearances be given in a fixed time frame.
Shri Shukla said that in the proposed draft the company or corporation that has been awarded a power project on the basis of competitive bids for tariff will get coal block without bidding, the scope in this section should be extended to the upcoming power projects in private sector, which have not been given coal linkages. For this purpose, some milestones can be fixed to be eligible for getting captive coal blocks for the private power developers, which are coming up without tariff based bidding process. The huge gap between demand and supply of energy and the present plans of the government owned corporations or companies couldn’t meet the requirements of the power for energy security of the country. The government should not only think in terms of making money through competitive bidding from private power projects. If power project has a captive coal block the electricity regulator will approve power tariff considering coal as a pass through, he said.