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    Commercial coal auction day 3: JSPL places highest bid for Gare Palma 4/1

    Commercial coal auction day 3: JSPL places highest bid for Gare Palma 4/1

    Commercial coal auction day 3: JSPL places highest bid for Gare Palma 4/1
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    By Anshu Sharma   IST (Published)

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    Once allotted by the government, JSPL will have assured coal security for the next 10-12 years and also benefit on transportation cost, as the mine is close to their steel and power plants in Chhattisgarh.

    Three coal mines were in the fray on day three of the commercial coal auction and Jindal Steel and Power Ltd's (JSPL) Jindal Power bid highest for the Gare Palma 4/1 coal mine at 25 percent revenue share.
    The Gare Palma 4/1 coal mine was allotted to JSPL prior to the auction regime that was brought in the coal sector. Thereafter, during the first auction, it was bid highest by Vedanta's BALCO which was never allotted to the company.
    The second time, the same coal mine was bid highest by JSPL but the government did not consider its bid on account of low valuation despite the company bid 53 percent higher on the floor price. Adani Enterprises, Hindalco Industries were also participants in the auction for Gare Palma 4/1 mine.
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    Once allotted by the government, JSPL will have assured coal security for the next 10-12 years and also benefit on transportation cost, as the mine is close to their steel and power plants in Chhattisgarh.
    "We are the highest bidder at a 25 percent premium over the index. The mine has about 39 million tonne of stock and if the government of India hands over the mine to JSPL, it will take another 10-12 months to commence mining. Last time also, JSPL was the highest bidder but the government decided not to hand over the mines to us. With our own mine, we can manage at 45 paise per mega cal and there would be saving of 10 paise per mega cal," said VR Sharma, managing director, JSPL.
    The other highest bids came from JMS mining at 9.5 percent revenue sharing for the Urtan North coal mine and a 54 percent revenue sharing bid came from Boulder Stone Mart for Gotitoria East and West mine. The smaller mines with first-time bidders continue to bid aggressively.
    Aditya Birla Group so far has bid highest for two coal mines. Adani Group company, Vedanta, and JSPL have bid highest for one coal mine each. The first round of coal auction of five mines is expected to garner about Rs 1,500 crore annually to the states where the mines are situated.
    The government offered 38 coal mines for commercial coal auction but interest received from companies for only 19 mines. Adani Group of companies is bidding for 12 coal blocks, followed by Aditya Birla Group companies in 8 coal mines, 4 bids from JSPL, 3 bids from Vedanta, and 1 bid from JSW. The auctions of 19 coal mines will end on November 9 and by November 11, the successful bidder's announcement will be made by the nominated authority.
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