Coal Mining in India to 2020

India is one of the three leading coal producers in the world, with production of 615 million tons (Mt) in 2013; an increase of 3.4% over 2012. India’s coal production mainly originates from states such as Chhattisgarh, Jharkhand, Orissa, Madhya Pradesh, Andhra Pradesh and Maharashtra. During FY2011–2012, Chhattisgarh accounted for the largest volume of non-coking coal production in the country, followed by Orissa, Madhya Pradesh, Jharkhand, Andhra Pradesh, Maharashtra, West Bengal and Uttar Pradesh. The state of Jharkhand alone had a share of more than 98% of the country’s coking coal production, while the rest was contributed by Madhya Pradesh, Chhattisgarh and West Bengal.

Scope

The report contains an overview of the Indian coal mining industry, together with the key growth factors and restraints affecting the country’s coal mining industry. Furthermore, it provides detailed information about production, prices, production by grade, type and mining methods, reserves, reserves by grade and regions, competitive landscape, major active, exploration and development projects, consumption, consumption by type and trade. Also included is the country's fiscal regime, which includes governing bodies and relevant laws, rights and obligations of the mining companies, as well as key fiscal terms.

Key Highlights

• Upcoming and ongoing coal projects are expected to improve the volume of coal production over the forecast period 2014–2020. During the 12th FYP, CIL identified a number of projects with a view to increase production to 556.4Mt in 2017.

• Modernization initiatives undertaken by the CIL are expected to enhance coal production. CIL will implement contemporary technology such as draglines, shovel-dumpers and surface mining. An Operators Independent Truck Dispatch System (OITDS) has also been introduced in several opencast mines to improve productivity.

• According to the Comptroller and Auditor General’s (CAG) report, a massive coal allocation scam took place that allowed a large number of private companies to acquire captive coal blocks at throwaway prices which resulted in an estimated loss of INR1.8 trillion (US$29.3 billion) to the exchequer.

• The Ministry of Environment and Forest (MoEF) has adopted some policies such as Comprehensive Environmental Pollution Index (CEPI) and ‘Go, No-Go’, under which areas with a high pollution index are prohibited for mining.

Reasons to buy

To gain an understanding of the Indian coal mining industry, the relevant drivers and restraining factors, historical and forecast production, consumption and trade data and the fiscal regime.

Companies mentioned

Coal India Ltd

Singareni Collieries Company Ltd

Reliance Power Ltd

Jindal Steel and Power Ltd

Table of Contents

1 Executive Summary 1

2 Coal Mining In India 7

2.1 Country Overview 7

2.2 Mining Overview 7

2.3 Coal Mining in India – Drivers 8

2.4 Coal Mining in India – Restraints 10

3 Coal Mining In India – Production, Consumption, Reserves And Trade 12

3.1 Reserves by Grade and Geographical Location 12

3.2 Historical and Forecast Production 15

3.2.1 Total Production by Grade 15

3.2.2 Total Production by Type 17

3.2.3 Total Production by Mining Method 19

3.2.4 Total Production by State (Region) 19

3.3 Coal Prices 21

3.4 Competitive Landscape 22

3.4.1 Coal India Limited (CIL) 22

3.4.2 Singareni Collieries Company Ltd (SCCL) 24

3.4.3 Reliance Power Limited 26

3.4.4 Jindal Steel and Power Limited (JSPL) 27

3.5 Total Production by Major Mines 29

3.6 Major Exploration and Development Projects 30

3.7 Coal Mining in India, Allocation/De-allocation of Coal and Lignite Blocks 32

3.7.1 Allocation of Coal and Lignite Blocks by Sector 32

3.7.2 De-Allocation of Coal Blocks 32

3.8 Coal Mining in India, Production of Coal from Captive Blocks 34

3.9 Coal Consumption and Trade 35

3.9.1 Total Consumption by Type – Non-Coking 35

3.9.2 Total Consumption by Type – Coking 35

3.9.3 Domestic Consumption vs Exports 37

3.9.4 Imports by Source and Type 39

3.9.5 Imports by Type – Steam Coal 39

3.9.6 Imports by Type – Coking Coal 39

3.9.7 Imports from Countries of Origin 42

3.10 Demand Drivers 43

3.10.1 Demand vs Final Uses 43

4 Fiscal Regime 45

4.1 India’s Governing Bodies 45

4.1.1 Ministry of Mines 45

4.1.2 Ministry of Coal 45

4.1.3 Indian Bureau of Mines (IBM) 45

4.1.4 Geological Survey of India (GSI) 45

4.1.5 Ministry of Environment and Forests (MoEF) 46

4.1.6 Coal Controller 46

4.1.7 Department of Atomic Energy (DAE) 46

4.1.8 Atomic Minerals Directorate (AMD) for exploration and research 46

4.1.9 Atomic Energy Regulatory Board (AERB) 46

4.2 India’s, Governing Laws 47

4.2.1 Mines Act, 1952 47

4.2.2 Mines and Minerals (Development and Regulation) Act, 1957 47

4.2.3 The Coal-Bearing Areas (Acquisition and Development) Act, 1957 47

4.2.4 The Atomic Energy Act, 1962 47

4.3 India’s, Mining Ownership and Licenses 48

4.3.1 Mining Licenses 48

4.4 India’s, Rights and Obligations 50

4.4.1 Rights 50

4.4.2 Obligations 50

4.5 India’s, Key Fiscal Terms 51

4.5.1 Fees 51

4.5.2 Rent 51

4.5.3 Royalty 51

4.5.4 Corporate Tax 54

4.5.5 Surcharge 54

4.5.6 Education Cess 54

4.5.7 Clean Energy Cess 54

4.5.8 Clean Energy Cess 54

4.5.9 Branch Profits Tax (BPT) 55

4.5.10 Withholding Tax 55

4.5.11 Losses Carry Forward 55

4.5.12 Deductions 55

4.5.13 Depreciation 55

4.5.14 Value Added Tax (VAT) 55

4.5.15 Tax Incentives 56

4.5.16 Tax Treaties 56

5 Appendix 57

5.1 What is This Report About? 57

5.2 Methodology 57

5.3 Secondary Research 57

5.4 Primary Research 57

5.5 Contact GlobalData 58

5.6 About GlobalData 58

5.7 GlobalData’s Services 58

5.8 Disclaimer 60

List of Tables

Table 1: Typical Proximate Analysis of Various Coals 12

Table 2: Coal Mining in India – Grades of Coking Coal 12

Table 3: Coal Mining in India – Grades of Non-Coking Coal 13

Table 4: Coal Mining in India – Grades of Semi-Coking Coal 13

Table 5: Coal Mining in India – Coal Resources by Type and Category (Million Tons), 2012 13

Table 6: Coal Mining in India – Geological Resources of Coal, Gondwana Coalfields (Million Tons), 2013 14

Table 7: Coal Mining in India – Geological Resources of Coal, Tertiary Coalfields (Million Tons), 2013 14

Table 8: Coal Mining in India – Geological Resources of Lignite (Million Tons), 2013 14

Table 9: Coal Mining in India – Total Production by Grade – Bituminous, Lignite and Anthracite (Million Tons), 2000–2020 17

Table 10: Coal Mining in India – Total Production by Type – Steam Coal, Lignite and Coking Coal (Million Tons), 2000–2020 19

Table 11: Coal Mining in India – Pithead Run of Mine Prices for Non-Coking Coal (INR/Ton), 2013 21

Table 12: Coal Mining in India – Coal India Limited (CIL), Major Projects 23

Table 13: Coal Mining in India – Singareni Collieries Company Ltd (SCCL), Major Projects 25

Table 14: Coal Mining in India – Reliance Power Limited, Major Projects 27

Table 15: Coal Mining in India – Jindal Steel and Power Limited (JSPL), Major Projects 28

Table 16: Coal Mining in India – Major Active Mines (Million Tons), 2012 29

Table 17: Coal Mining in India – Major Exploration Projects (Million Tons), 2012 30

Table 18: Coal Mining in India – Major Development Projects (Million Tons), 2012 31

Table 19: Coal Mining in India – Allocation of Coal and Lignite Blocks by Sector, 1993–2011 32

Table 20: Coal Mining in India – De-allocated Coal Blocks, January 2014 33

Table 21: Coal Mining in India – Production of Coal from Captive Blocks, 2011–2013* 34

Table 22: Coal Mining in India – Total Consumption by Type – Steam, Lignite and Coking Coal (Million Tons), 2000–2020 37

Table 23: Coal Mining in India – Coal Consumption and Exports (Million Tons), 2000–2020 39

Table 24: Coal Mining in India – Steam and Coking Coal Imports (Million Tons), 2000–2020 41

Table 25: Coal Mining in India – Imports from Region and Country of Origin (Million Tons), 2013 42

Table 26: Mining Industry in India – Dead Rent Rates Per Hectare (INR), 2014 51

Table 27: Mining Industry in India – Coal and Lignite Royalty Rates, (INR/%), 2014 53

Table 28: Mining Industry in India – Coal Middlings Royalty Rate, (INR/%), 2014 53

Table 29: Mining Industry in India – West Bengal Coal and Lignite Royalty Rates Per Tons, 2014 54

Table 30: Mining Industry in India – Withholding Taxes (%), 2014 55

Table 31: Mining Industry in India – Depreciation Rates (%), 2014 55

List of Figures

Figure 1: Coal Mining in India – Total Production by Grade – Bituminous and Lignite (Million Tons), 2000–2020 16

Figure 2: Coal Mining in India – Total Production by Type – Steam Coal, Lignite and Coking Coal (Million Tons), 2000–2020 18

Figure 3: Coal Mining in India – Total Production by State* (%), FY 2011–2012 20

Figure 4: Coal Mining in India – Total Consumption by Type – Steam, Lignite and Coking Coal (Million Tons), 2000–2020 36

Figure 5: Coal Mining in India – Coal Consumption (Million Tons), 2000–2020 38

Figure 6: Coal Mining in India – Imports by Type (Million Tons), 2000–2020 40

Figure 7: Coal Mining in India – Imports from Country of Origin (%) 2013* 42

Figure 8: Chinese Coal Imports (Tons), 2008–2013 43

Figure 9: Indian Coal Imports (Tons), 2008–2012 44

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