Bidders concerned about price ahead of coal auction

There are 100 companies in the fray for bidding in the first round of coal block auction and some of them have urged the government to simplify procedures at the qualification stage.

A senior official said that in the qualification stage bidders will have to give an indicative price and only the top five will go for the next stage of e-auction.

Some of the companies raised concerns about the double price bid at a meeting of prospective bidders convened by the government recently to discuss the proposed auction of 23 coal blocks in the first round.

An indicative price is the first price quoted by the company based on its own valuation of the coal block, the official explained. After the qualification stage, the shortlisted five bidders will have to again quote a price.

The Associated Chambers of Commerce of India had earlier suggested to the government that no indicative price offer should be sought during the qualification stage and all pre-qualified bidders should be allowed to bid.

During the pre-bid meeting, attended by almost 100 companies, questions were also raised on different issues, including enduse plants linked to the coal mines.

The meeting was chaired by Vivek Bhardwaj, the designated authority for the auction and joint secretary in the coal ministry. Bidders who wish to participate in the auction will have to pay an application fees of Rs 5 lakh, which is non-refundable.

After submitting the money, a bidder will have access to complete details of the coal blocks.

The government has earlier dropped one coal block from the list of 24 mines due to technical reasons. After dropping Namchik Namphuk mine, in Arunachal Pradesh, from the list, 23 mines will be available in the first auction now.

E-auction of mines for qualified bidders will be held from February 14-22.

Meanwhile, Union finance minister Arun Jaitley said in Gandhinagar that the much-awaited auction of coal blocks to private companies will begin soon. "Coal block allocations to the public sector and auctions to the private sector will begin soon."