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CIL seeks development partners for two CBM blocks
INDIA
STATE-RUN Coal India Ltd (CIL) has invited bids for two coal-bed methane (CBM) devel- opments, opening the acreages to local and international players CIL is looking to sign rev- enue-sharing agreements for the blocks, which are expected to require more than $325mn worth of investment.
Adani, Essar and Reliance Industries Ltd (RIL) have reportedly participated in a prebid meeting
CIL subsidiary Bharat Coking Coal Ltd (BCCL) said it was looking for a contractor to explore and develop the Jharia CBM Block-I in the eastern state of Jharkhand and the market the production. The block, which is expected to require INR18.79bn ($248.2mn) worth of investment, holds an estimated 25bn cubic metres of CBM reserves. First production is slated for two years from start of development.
Sister company Eastern Coalfields Ltd (ECL) has offered the Raniganj CBM block in the neighbouring state of West Bengal for exploration, with the project estimated to need INR5.95bn ($78.6mn) worth of investment. The block is estimated to hold 3 bcm of CBM.
Each project will be developed over three phases – exploration, pilot assessment and mar- ket survey, then development and production.
CIL has appointed its wholly owned Central Mine Planning & Design Institute (CMPDI) as principal implementing agency (PIA) to both
projects to help speed them up.
“As part of the bidding documents, the PIA
on behalf of the lessee has provided a reve- nue-sharing contract (RSC) agreement, which sets forth the detailed terms and conditions of the project, including the development of the CBM project, operation and maintenance of the CBM project, extraction, delivery and marketing of CBM extracted and rights and obligations of the [developer],” the company said.
Local financial daily the Economic Times quoted an unnamed CIL executive on May 14 as saying that Adani, Essar and RIL had partic- ipated in a pre-bid for the CBM projects. The executive said the company planned to invite bids in the coming week and that CIL was reviewing them.
“One more CBM block at South Eastern Coalfields Ltd (SECL) is likely to be tendered.
Additional CBM blocks are under deline- ation at Central Coalfields and in Bharat Cok- ing Coal’s leasehold areas,” the paper quoted an unnamed spokesperson as saying.
CIL is under pressure to expand its busi- ness interests following Indian Finance Min- ister Nirmala Sitharaman’s announcement on May 16 that the government intended to break its monopoly over the coal-mining sector. She revealed that the private sector would be able to bid for nearly 50 block under a revenue-sharing mechanism.
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