India’s first-ever tender to commercially mine and sell coal has received 82 bids from 46 companies for 23 coal mines, while a total of 38 coal mines were put for auction. The remaining 15 mines did not receive any bid. Adani Group has bid for 9 mines and Hinalco Industries for 5 mines. As much as 65% of all the bidders do not run industries that require coal, which means that these companies are primarily interested in commercial sale of the fuel.
India launched the auction process of coal blocks for commercial mining without any end-use restrictions in June 2020. The mines will require an investment of around INR300bn (US$4.1bn) over the next five to seven years and should reach peak production of 225 Mt, accounting for 15% of the country's total coal output in 2025-2026. Four projects have been identified and could gasify around 100 Mt of coal by 2030 at a cost of INR200bn (US$2.7bn).
In January 2020, the government promulgated the Mineral Laws (Amendment) Ordinance 2020 that aims at attracting investors in the coal mining sector by removing restrictions on end-use and prior experience in coal auctions. According to the government, India's coal production is expected to reach 700 Mt in the current fiscal year (April 2020-March 2021), corresponding to a 16% annual increase. The government aims at stopping most of substitutable coal imports and bets on the higher domestic production.
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