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Coal block auctions will be completed by March 31, says Goyal

Complying with the Supreme Court order, as much as Rs 6,100 crore (just over 60 per cent) has already been forked out as penalty by allottees whose coal blocks were cancelled. This money is already vested with the power ministry and will in all probability end up in the Consolidated Fund of India.

Coal and power minister Piyush Goyal told Mail Today on Thursday, "I don't have to, but I will complete the auction process by March 31. This will ensure continuity of production. I am in a dialogue with a plethora of private players and believe me, they will come forward. This is the only solution. We have worked out the math and ensured that the up-front money is a small sum. We are also going in for reverse bidding, which will keep tariffs down."

Goyal's thinking is predicated on the fact that auctions will boost coal production in a big way. "There are two things going for us in the auctions: resolve the coal pipeline, which is stuck, by offering prices that will be cheaper than Coal India's and ramping up plant load factor to 90 per cent instead of the current 60-65 per cent."

Shouldn't genuine players who got allotment have been given the right of first refusal given their investment in projects? Pat came Goyal's counter, "Life is like that. when the stables are being cleaned, everything goes out-good, bad ugly and indifferent. One has to start afresh. The majority of the affected players have welcomed unilaterally the equal opportunity that this auction presents. Believe me, this was required. This way it is kosher and transparent and offers a seamless migration to a new dispensation."

Goyal likes to walk the talk. His life's mission is to provide 24X7 power to Indians. He has already promised Rs 7,700-crore investment to Delhi ensuring a power surplus capital. He said, "My investment is in energy efficiency and availability of cheaper power. Through smart purchase management, we have already saved Rs 700 crore for Delhi in the last seven months. The key is to ensure that power tariffs don't go up. By offering a choice of distributor, we will make the system more competitive."

Having resolved the two-day deadlock with the coal unions, Goyal is confident about turning things around, "There is no intention of denationalisation of CIL.

The present and future interest of CIL employees will not be affected in any manner. CIL will be protected and there need be no apprehension about its ownership or management going into private hands. I want to make Coal India (CIL) the most valuable coal company in the world by doubling its capacity to 100 million tonnes. And I will achieve this by bringing the unions and other stakeholders on board."

Emphasising that efficiency is the only way forward, Goyal assured CIL by saying there is absolutely no change in "any of our plans (of diluting some stake in CIL and to open up the coal sector to private mining).

They (unions) have assured me that they will be part of mission 100 crore tonnes (Coal India's production by 2019-20) and they have assured me that they will make up for the loss of production of about a million tonne".

It is the private sector, which has been wailing like widows on the sector's woes for over two years now. Goyal is pragmatic. He says he doesn't have a magic wand, but he has a sense of commitment.

Breaking down the private sector's woes into three areas-financing, lack of fuel and non signing of power purchase agreements-Goyal reckons there cannot be a miracle overnight. He was quick to add, "I inherited a complete mess. I am working on solving the problems progressively; there is no point in crying over the situation.

The long delays with both installed capacity and stressed plants has to be ironed out. I am confident that the 204 mines that will be auctioned will offer a great starting point. Banks pressure will reduce, moratoriums will be longer and promoters who have no equity left to provide will find things easing."

Source: Business Today