Following the coal ministry’s directive, the state-owned Andhra Pradesh Mining Development Corporation (APMDC) has speeded up the pre-mining process on two captive coal blocks in Orissa and Madhya Pradesh. Allotted by the ministry in 2006 and 2007 respectively, these two blocks together hold over 1 billion tonne of coal reserves.
Of the two, the Naugaon-Telisahi coal block, which is estimated to have 900 million tonne of coal reserves, was awarded jointly to APMDC and the Orissa Mining Corporation (OMC) on an equal sharing basis.
The Suliyari coal block in the Singrouli coalfields of Sidhi district in Madhya Pradesh, which has 150 million tonne of high-grade coal, is to be developed by APMDC in partnership with the state-owned Singareni Collieries Company Limited (SCCL).
“We are currently working on the pre-mining process regarding the two coal blocks that would enable us to start production by mid 2014,” said Mukhesh Kumar Meena, managing director of APMDC.
A joint venture company, Naugaon-Telisahi Coal Company Limited, has already been formed by APMDC and OMC with 50:50 partnership for the development of the coal block located in Angul district.
The JV company needs to acquire 1,540 hectare of land for this purpose, of which 1,240 hectare is private land, while about 95 hectare falls in the forest area. Also, the acquisition process involves rehabilitation of about 1,400 households living in this area.
APMDC hopes that the land acquisition will be done smoothly since the Orissa government is also involved in the project. The company is expected to submit the mining plan to the Centre by April next year.
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“We will soon appoint a transaction advisor, who will in turn handles the selection of the mine development operator (MDO) for the project,” Meena told Business Standard. The exact investment required for the project will be known once the mining plan is ready, he said.
With regard to the Suliyari block, APMDC has already furnished the mining plan to the Union government. An investment of about Rs 730 crore is proposed to develop this coal block. Details as to how to raise the requisite funds will be determined once APMDC decides the nature of the proposed partnership with SCCL in developing the block.
“We are yet to take a decision on whether to make SCCL the joint venture partner with a substantial equity participation or to keep it as an MDO,” Meena said.
The Orissa block’s mineable reserves of 800 million tonne of coal are valued at Rs 62,000 crore, while the mineable coal in the Madhya Pradesh coal block is valued at Rs 22,500 crore. The former, with predominantly F-grade and D-grade coal, will be developed on an open cast basis while the latter, which has high-grade -- C, D and E -- reserves, will be developed through underground mining, according to officials.
APMDC had so far applied for 27 coal blocks for supply of coal to the state power utility, APGenco.