Coal India Limited (CIL) said on Wednesday it has awarded 23 closed and discontinued underground mines on a revenue sharing basis to private players.

The mines have a cumulative peak rated capacity of 34.14 million tonnes (mt) per year, while extractable reserves are 635mt.

The public sector miner identified 34 mines where operations were discontinued but had dormant reserves.

Of the 34 mines, Bengal-based Eastern Coalfields Limited and Jharkhand-based Bharat Coking Coal Limited account for 10 mines each. Western Coalfields (five), South Eastern Coalfields (four), Mahanadi Coalfields (three) and Central Coalfields (two) comprise the remaining amount.

"The minimum revenue to be shared is 4 per cent and the contract period is for a maximum of 25 years," Coal India said in a statement.

Coal India underlined the advantages of mining from these mines: conservation of resources, substitution of imported coal for the non-regulated sector with good quality coal and provision of livelihood to the locals.

"From an environmental point of view there would be no land degradation as the mining infrastructure is already in place," the company said, adding it was identifying more mines.

The successful bidder or the mine operator can use the existing infrastructure and project facilities without additional payment to the authority.

There are additional incentives if the coal is used for gasification or liquefaction purposes: Coal India will give 50 per cent of its revenue share back to the operators.

In a consortium, foreign bidders are permitted to participate as second or third members, the company said.

The mine operator can sell the coal at market prices through an auction process and shall have the freedom to use its technology and machinery, Coal India said.

Coal India scrips at ₹478.20, were down 2.18 per cent over the previous close at the BSE on Wednesday.

Coal stock

Thermal power plants had stocks of over 45mt on June 16, higher by 32 per cent compared with the same day last year, a coal ministry statement said on Wednesday.

The demand for coal based power has grown 7.30 per cent in this financial year compared with a year ago, which is the highest ever demand for coal, the ministry said.