Coal India (CIL) may be allowed to extract coal-bed methane (CBM) from its vast leasehold mining areas soon, opening new business avenues and boosting revenues for the state-owned coal monopoly. Current rules prohibit coal miners from extracting methane released during the mining process, wasting a valuable natural resource.

“We have given in-principle approval to a new policy on coal mine methane. We will soon move a Cabinet note to allow CBM extraction by CIL,” a petroleum ministry official said.

New Delhi Environment minister Jayanthi Natarajan may have objected to the creation of a National Investment Board (NIB) for its potential to undermine her ministry, but the finance ministry has no doubt that the biggest hurdle to investors right now is posed by Natarajan’s ministry.

In an internal note meant to be a precursor to a full-fledged Cabinet note prepared before Natarajan wrote to the Prime Minister against the idea of NIB, the finance ministry’s department of economic affairs had cited environment clearance (EC) and forest clearance (FC) as “best-known examples” of regulations impeding decision-making process.

New Delhi They can do so by paying a fee, but must sell the mined fuel back to govt at a discount

Stepping up the gas on coal production, the government proposes to allow companies exploring coal bed methane (CBM) to simultaneously mine coal from the same block. Permission may be given to both existing and new operators of CBM blocks to undertake coal mining in the same fields. As of now, CBM blocks, characteristically much larger than coal blocks, cannot be mined for coal until the gas venture is completed and the field surrendered to the government after the 35-year lease. This has reduced the area for coal mining for a long duration, increasing pressure on coal companies facing stagnant production.

New Delhi The government proposes to constitute an empowered group of officials along the lines of the Foreign Investment Promotion Board (FIPB) as a single-window mechanism for granting statutory clearances to coal mining projects.

The purpose is to facilitate and expedite approval process and step up coal production in the country. Though composition of the proposed body is yet to be finalised, sources said the ministries of environment, coal, power and steel as well as concerned state governments would be represented on the panel. The group would periodically take up individual cases referred to it and would take decisions in a time-bound manner.

New Delhi The shortage of domestic coal is finally beginning to affect development of new power projects in the country with the government proposing to stop acceptance of companies’ applications for fresh coal linkages for a period of three years. It may also restrict provision of long-term coal linkage to only 60,000 mw of power projects in the 12th Five-Year Plan against the power ministry’s recommendation for 1,50,000 mw of projects.

New Delhi The government is likely to postpone the implementation of coal price pooling because of the strong opposition from consuming states who feel it would raise the cost of power generators and increase tariff for consumers.

Under price pooling mechanism, CIL would have subsidised the price of imported coal (which is 50% costlier now) by raising domestic coal prices and supplying full quantity of coal at uniform price to consumers. The pooling mechanism, being finalised at the instance of the Prime Minister's Office (PMO), is meant to address coal shortage being faced by consumers and would be especially helpful to new power plants to cut the cost of fuel imports.

New Delhi In a bid to protect its revenue stream and maintain margins while fulfilling its obligations to supply higher level of coal to the power sector under the new fuel supply agreement, Coal India is going in for an aggressive strategy to step up output. The focus will be on increasing the supply of washed coal to the consumers commanding a premium pricing.

The company, which is producing about 22 million tonne of washed coal at present, expects to take up production to about 300 mt or over 50% of its total coal production by over next few years.

New Delhi In a move that might speed up environmental clearances for mining firms, the Centre may ask the Indian Bureau of Mines (IBM) to independently verify compliance of norms suggested by the ministry of environment and forests (MoEF) for all mining projects.

This is being done to ensure constant monitoring of projects during the execution and completion stages. The MoEF has already proposed the need for evolving an independent monitoring system to get a fair assessment of the project and also reduce chances of conflict between the ministry and project proponents.

New Delhi The axe is likely to fall on about two dozen captive coal block allottees that feature in both the CAG list of companies making windfall gains and the list of entities that were issued show-cause notices by the coal ministry last year for sluggish progress on their respective projects.

Prominent companies, including Tatas, Essar, ArcelorMittal, GVK Power, Hindalco, Grasim Industries, JSW and Bhushan Steel, feature in the list where the coal ministry feels that allocations should be cancelled unless valid ground for delay is established. The ministry has already issued show cause notices to around 58 captive coal block allottees and about 20-24 of them also feature in the CAG list that is being targeted by the ministry for first round of cancellations.

New Delhi Under SPV model, government will get all statutory clearances for greenfield projects

Stung by allegations that natural resources have been allotted in non-transparent ways, the government is set to start auction process in the steel sector, whereby certain large projects would be offered on the basis of the highest upfront payment and royalty bid. The ministry of steel is planning to introduce the special purpose vehicle (SPV) model for awarding projects.