Govt inks pacts with Damodar Valley Corporation for coal production in 3 blocks
New Delhi, Jan 15
The Ministry of Coal has executed coal mine development and production agreements with Damodar Valley Corporation for three commercial coal blocks -- Dhulia North, Mandakini B, and Pirpainti Barahat -- in a significant step towards reinforcing India's energy security and accelerating economic growth, according to an official statement issued on Thursday.
These blocks were successfully auctioned under the 13th round of commercial coal mining auctions.
The execution of these agreements represents a significant milestone in India's journey towards self-reliance in the coal sector. All three coal blocks are fully explored and together account for a cumulative Peak Rated Capacity (PRC) of 49 million tonnes per annum (MTPA), underscoring their strategic importance in meeting the country's growing energy requirements, the statement said.
The projects are envisaged to generate an estimated annual revenue of Rs 4,621 crore, while attracting a capital investment of approximately Rs 7,350 crore, thereby contributing substantially to economic activity and industrial growth, the statement said.
In addition to strengthening energy availability, the development of these coal blocks is expected to deliver significant socio-economic benefits. The three projects are projected to create around 66,248 direct and indirect employment opportunities, fostering livelihood generation and regional development in the coal-bearing areas.
In 2025, the Ministry of Coal launched the 13th round of commercial coal block auctions in August and successfully auctioned seven coal blocks. It also issued vesting orders for eight more blocks earlier in October. The 13th round of auctions offers both fully and partially explored blocks, and includes reforms like incentives for early production and updated penalties for delays.
As part of the coal sector reforms, the government has moved from an earlier restrictive model to granting coal mining blocks pursuant to a competitive bidding process, and from prescribing specific end-use to permitting commercial sale of coal. The auction-based regime introduced in 2014 allowed private sector participation, however it was limited to captive usage in own end-use plants. Now, the sector has been opened up for commercial coal mining by private players in 2020.
Commercial coal block auctions are conducted in a two-stage online bidding process, which involves technical screening and submission of competitive initial price offers in the first stage, and a second and final stage where better price offers are intended to be received.
— IANS
Reader Comments
Creating 66,000+ jobs is the best part of this news! This will transform the local economies in those regions. Direct employment means stable incomes for families. 👏
While coal is needed for now, I hope a significant portion of the ~Rs 7,350 crore investment is also directed towards R&D for cleaner coal technologies and eventual transition to renewables. We can't ignore climate commitments.
The shift from a restrictive model to competitive bidding and commercial sale is a positive reform. It should bring in efficiency and better management. Hope the revenue projections are met for the states.
DVC has the experience. These blocks being fully explored reduces initial risk. The two-stage bidding process seems transparent. This is a solid step for Aatmanirbharta in the coal sector.
Annual revenue of Rs 4,600+ crore is impressive. This will boost state finances. My only request to the authorities: please ensure strict monitoring so that the promised employment and local development actually happen on the ground.
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