Draft Coal Blocks Allocation Rules, 2016

The government is considering capping the amount of coal blocks that a company can hold. The clause is part of the draft coal block allocation guidelines issued for public comments by the coal ministry and would apply to mines other than the 204 blocks that were cancelled by the Supreme Court in October 2014. The Centre may also specify the maximum number of coal blocks or amount of coal reserves or both that may be allocated to a company or corporation or its subsidiary or associate companies, the draft coal block allocation rules said. The draft rules have been framed to bring the provisions of Mines and Minerals Development and Regulation Act in line with the provisions of Coal Mines (Special Provisions) Rules, 2014, to bring uniformity in the coal block allocation. The Mines and Minerals Develop ment and Regulation Act of 1957 is the governing legislation of the coal sector. It was amended in 2012 to provide for competitive bidding in coal block allocations.The Coal Mines (Special Provisions) Act 2015 was brought in to auction the 204 coal blocks cancelled by Supreme Court. The rules provide that in case coal block is allotted or secured by a project with supplies from Coal India, then entitlement to receive coal will be proportionately reduced.

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