Auctions for commercial coal mining draws close to emphatic fashion with the sale of Gare Palma IV/7 block carried on the final day.
Financial bidding for the block started at an impressive floor price of 44%, which was almost 25% higher than the average price seen on the previous occasion.
Subsequently, after a tussle amongst the 8 participants which lasted almost 5 hours, Sarda Energy and Minerals emerged as the winner by quoting final price of 66.75% (which is the highest bid recorded in the current round of auctions).
This was the second coal block procured by the company after it had won Sahapur West on Day 2.
The block had been under the spotlight for possessing necessary statutory permissions/approvals required for beginning the mining operations, therefore it had attracted various end-user firms having captive coal requirement.
In total, 19 coal blocks have been sold under the first commercial coal mining auctions based on revenue sharing model which had also incorporated relaxation on entry barriers and end-user restrictions.
These were booked at an average final price of 27.32% which translates into revenue share of INR 626 for unit metric tonne coal production, considering average representative price of INR 2292/t for various non-coking coal grades.
The proceedings were majorly dominated by non-end user participants, with Essel Mining, Aurbindo Reality and JMS Mining each bagging two blocks each in the financial bidding round, Sarda Energy and Mineral being an exception has also won two blocks now.
Next up, nominated authority would recommend the selection to the government for approval on 11 Nov ’20, thereafter issuance of vesting order for these blocks is expected within 2 months, as per the revised schedule.
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