Coal ministry plans limited coal supply to steel and cement companies. Companies must mention the end-use and their plant requirement of the coal before bidding in the auction.
Coal ministry after introducing quota system in coal auction for non-regulated sector, has now decided to impose an injunction to avoid desperate bidding from the participants in upcoming coal auction. According to this enjoin, participants will have to mention the quantity of coal required by them for their plant along with the end-use of the coal supply they are bidding for.
Further, if any company fails to explain the requirement and end-use details of the coal supply, they will not be allowed to participate in the auction. This implies that the companies will be restricted from bidding for more than 100% of their plant requirements. This will help in removing ambiguity and enable fair distribution of coal supply to fuel craving non-regulated sectors.
According to sources, this policy would be documented any time soon in the coming week and will be valid for next five years.
It should be noted that, earlier, coal ministry used to offer coal through coal linkages on nomination basis to non-regulated sectors. These sectors include steel and cement, where it was not mandatory for the participating firms to disclose the quantity and the end-use of the coal in concrete.
-Sourced
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