Coal India plans to use private sector mine developer and operators (MDOs) to scale up production. The public sector miner on Wednesday said it has issued letters of acceptance for seven coal projects to be pursued through MDOs with a cumulative capacity of 100 million tonnes per year.

Of the seven projects, three belong to Central Coalfields, two to Mahanadi Coalfields (MCL) and one each to South Eastern Coalfields and Eastern Coalfields (ECL).

Two of the projects — the Siarmal open-cast project of MCL in Odisha and the Hura ‘C’ open-cast project of ECL in Bengal — are expected to start mining operations during this financial year. The coal miner is tracking a total of 15 greenfield coal projects to mine through MDOs.

Coal India’s investment would be around Rs 20,600 crore, which will be spent on land acquisition, rehabilitation and resettlement and in some cases, railway sidings. The role of MDOs would be to excavate, extract and deliver coal to Coal India’s companies according to the approved mining plan.

While the ownership of mines and sale of coal is the responsibility of CIL, the bulk of the capex investment would be done by the MDOs besides bringing efficiency in operations.

They would also have to coordinate with the state and central pollution control boards to fast-track the required approvals, Coal India said in a statement.

The contract period is 25 years or the life of the mine, whichever is less. The long-term contracts would allow the operators to develop allied infrastructure in the mining projects.