Jindal Power moves HC seeking refund of additional levy paid for coal auction
Jindal Power Ltd. moved the Delhi high court on Tuesday, seeking a refund of Rs1,185 crore paid as additional levy for participating in the coal auction that was subsequently cancelled in September 2014.
A bench comprising of chief justice of Delhi high court, G. Rohini and Justice V. Kameswar Rao, before whom the matter was brought, sought the response of the Centre on the issue before the next date of hearing.
Jindal’s plea challenged the provisions of the Coal Mines (Special Provisions) Act, 2015 under which payment of the additional levy was made mandatory.
In its plea, the company contended that it had paid a total of Rs1185,20,33,280 as additional levy for participating in the auction process and sought refund of the entire amount. It has questioned a 2012-13 report by the Comptroller and Auditor General of India (CAG) to the extent that it calculated a net gain of Rs295 per metric tonne of coal to allottees of coal blocks.
In September, 2014, the apex court had cancelled allocation of 214 coal blocks on grounds that the allotment process was arbitrary and illegal.
The case will be heard next on 13 February, 2017.
Demonetisation of Rs 500 and Rs 1,000 notes has hit Coal India’s e-auction that was meant to offer coal to traders and non-power producers like sponge iron firms, brick kilns and small consumers who do not have a supply commitment from CIL.
Drying up of payments from their customers have resulted in depleting cash in the hand of these coal consumers, which in turn has resulted in them not being able to make upfront advance payments for participating in e-auctions. Lack of cash in the system has been a major problem for coal consumers who use casual labours to load and unload coal on trucks.
Coal IndiaBSE -0.23 % had extended the deadline for payment of advances for participating in e-auctions from November 11 to November 18 in view of demonetisation.
There are a large number of small traders who regularly buy coal through eauction. They primarily transact in cash with their consumers. This section of the bidders have been finding it difficult to participate in the auctions.
“Traders carry the coal on trucks which is loaded and unloaded by manual labourers. Payments to trucks and labourers are made in cash who do not accept cheques and are not comfortable with fund transfers,” said a coal trader. “This has led to stoppage of coal transport, prompting them not to participate in auctions since they cannot lift the coal,” the person said.
A senior official from a coal consumers association said a large number of medium and small sponge iron manufacturers regularly participating in auctions deal in cash with their customers. “A major portion of this segment are not in a position to pay the advances and is facing the possibility of not being able to participate in the e-auctions.”
Apart from paying an advance to Coal India for participating in the auction, successful bidders need to pay upfront before lifting the coal. Coal India does not generally offer credits to small consumers and traders. This category of consumers, large in number, are now facing hardship in participating in auctions.
Mining sector can add $70 billion to India's GDP in next 15 years: CII
A vibrant mining sector has the capacity to spur growth and add up to $ 70 billion to the country's economy as well as generate 60-70 lakh jobs, a report by industry body CII said.
The report -- Mining Opportunities - Realising Potential -- also stresses on dealing with clearances which it says "still remain an impediment for a smooth transition from auction stage to implementation stage".
A vibrant mining sector has the potential to propel economic growth not just through its contribution to GDP but also through its forward and backward linkages, the report said.
"In high growth scenario, mining sector can add close to $ 70 billion to GDP from now to 2030. Mining could play a crucial role in employment generation for India moving many from poverty to empowerment. In an accelerated growth scenario, mining can generate an additional 6-8 million jobs," it added.
Over last two years, the government has taken some important steps for removing stagnation in the sector. A major step is the enactment of Mines and Minerals (Development and Regulation) Act, 2015, which has made the process of allocation of mines transparent by introducing auctions.
The tenure of the mineral concessions has also been increased from the existing 30 years to 50 years, the report said.
"Presently, the process of obtaining approvals and clearances still remains long drawn and varies from state to state. This requires to be made simpler and expeditious so that the time required for operationalisation of the mineral concession can be drastically reduced," it added.
The report said that Environment and Forest clearances take long time in clearing adding that industry realises that these are non-negotiable and sustainable development needs have to be addressed at all stages.
"However, the problem is the inordinately long time that is required for obtaining this clearance and the cumbersome process involved therein," it said.
Environment Ministry has launched online portals for submission of applications and responses to queries but the desired results are yet to be achieved, it added.
"There is significant room for improvement in the clearance system in terms of efficiency, speed of decision making, predictability and transaction," the report said.
On clearances, the report said finalise specific timelines for each approval process step, without modifying the overall stipulated time in the notification. Finalise responsibilities and accountability at each process step, wherever not defined at present.
Work on digitising the approval process for enabling integrated online communication channel between central, state and district authorities, it recommended.
"Areas free from national park, sanctuaries, wildlife corridors etc be put up for auction," it said.
Trump's big plan for the coal industry just got even harder
President-elect Donald Trump faces an uphill battle fulfilling his promises to revive the U.S. coal industry. The battlefield became even more pitched when Canada said it would speed up its effort to reduce its coal consumption.
America's neighbor to the north was the fifth-largest market for U.S. coal in 2015. Its pledge on Monday to get off coal sooner than expected will only pile more pressure on a U.S. industry that has seen nearly half of its production fall into bankruptcy due to falling demand, lower prices and a global oversupply of coal.
U.S. Coal Export Decline
U.S. coal exports for the first six months of the year in millions of short tons.
To be sure, Canada's appetite for U.S. coal was already declining. The chart above also shows India's growing consumption offset the decline in exports to Canada.
But among the top five U.S. coal export markets, only India and the Netherlands purchased more supplies last year. And imports through the first six months of 2016 fell in each of those top destinations, except Brazil. Large year-to-date declines in the Netherlands, South Korea and India have dwarfed the Brazil bump.
U.S. coal exports fell 24 percent overall in 2015 and have fallen another 32 percent through the first half of 2016.
Trump is vowing to put coal miners back to work by rolling back regulations, offering tax breaks to invest in infrastructure and ending a moratorium on mining on federal land enforced by President Barack Obama. He would also cancel Obama's Clean Energy Plan, which would force power plants to capture more greenhouse gases.
However, those changes would not address the core problem faced by the U.S. coal industry, which is that it can't compete on price with surging U.S. natural gas production.
The route to "market equilibrium" for an ailing U.S. coal industry is further industry consolidation and more mine closures, the International Energy Agency said last week in its annual World Energy Outlook. After the industry shrinks through the early 2020s, the remaining U.S. companies will emerge as solvent and more fit to compete, according to the IEA's forecast.
It is critical for Trump to defy the odds, because he has not articulated a Plan B for coal country. His campaign rival, Hillary Clinton, laid out a plan to invest $30 billion to retrain workers in coal-producing regions so they could work in other fields.
Modern alchemy: Russian scientists discover how to extract gold from coal
Researchers from the Russian Academy of Sciences’ Far East branch say they are building a facility to make gold out of coal.
Although the science is no fairy tale, to the dismay of business owners, the process is not as productive as they might hope – burning a ton of coal yields one gram of gold, tops.
At present, the scientists are setting the bar even lower, expecting a yield of 0.5 grams, or 1,500 rubles, per ton.
“We burn a ton – we gain 1,500 rubles,” Oleg Ageev, CEO of Complex Innovative Technologies of the Amur Scientific Center, said in a press statement.
At current exchange rates, that is roughly $23 US dollars.
The discovery of gold lacing in coal is the result of 15 years of study from different fields.
To create the gold, smoke created in burning coal goes through a hundred-fold purifying system. The residue is then flushed through a filter with water, allowing a gold concentrate to be extracted that is later used to make the precious metal.
The scientists are planning to test the gold-making equipment in one of the Amur region’s boiler houses next year, and ultimately hope to receive a grant to develop and implement an industrial grade device.
“We plan to use municipal boiler houses to implement our filtering system because they burn about eight to 10 thousand tons in a season, and that’s potentially 10 kilos of gold.”
Deputy head of the Amur scientific center of the Russian Academy of Sciences’ Far East branch, Andrey Konyushok.
The whole operation is on hold until spring kicks in because of subzero temperatures. Part of the process takes place outside and the water used for filtering freezes up.
https://www.rt.com/news/367821-coal-gold-technology-russia/
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Anurag Singal
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Essel Mining & Industries Ltd
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