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Mining: Go mega for energy security and better infra

Mining: Go mega for energy security and better infra

A shortfall in coal supply can badly affect the power production of the country as over 70 per cent of total power produced in India is from coal-based projects. While importing the required coal is a costly affair, setting up of mega coal projects is the viable option, writes JP Panda.

It is evident that coal has the dominant role in the energy security of India. The country presently pro­duces 539,251 million units of power out of 771,173 million units (70.41 per cent) from coal. Demand for coal for the year 2011-12 is 713.24 million tonne (mt), but the industry is likely to produce only 629.91 mt or less, resulting in a shortfall of 83.33 mt or more-which, therefore, must be imported. Shortfall in coal supply may touch 269 mt by 2021-22, from the current level of around 80 mt as domestic producers fail to keep up with the growing demand for the commodity.

Coal reserves

The total potential coal bearing area of the country is about 17,300 sq km, of which about 79 per cent has already been covered by regional exploration. Out of the remaining area, 15 per cent is covered under coal-bed methane (CBM) blocks, whereas about 1,000 sq km is still left for regional exploration. Through regional exp­loration followed by detailed exploration in promising patches, 267.21 billion tonnes (bt) of coal resources in the country have been established. Further exploration may increase the coal reserves.

A broad estimate of extractable reserves, based has been presented in the table below:

These estimates are tentative and broadly valid for the present. From the table, it can be seen that extractable reserves are only 54 per cent of the total reserves of 267 bt. Out of this, 51 bt has been allocated to the captive owners in small patches proportionate to their require­ment. Out of these, extractable reserves may be hardly 50 per cent. Even the extractable reserve shall be reduced further because of coal loss in barriers, safety zones and for slope stability. Had mega projects been planned, this loss would have been minimum.

The so called biggest achievement of the Coal Ministry was the allocation of 214 coal blocks with an estimated coal reserve of 51 bt to government and private captive users. Till date, the production has com­menced only in 25-26 allocated coal blocks and the production from these coal blocks for the year 2010-11 is hardly 35 mt.

The captive blocks were supposed to have augmented production to the tune of 200 mt but it didn't for many reasons like land acquisition, forest clearance, environ­ment clearance, etc. The failure has put India at a very disadvantageous position.

However, it is now questionable whether sub-divi­ding the coalfields to 214 blocks with loss of coal on barriers up to 30-40 per cent, was the right decision. On the hind sight it looks like a huge mistake. The required production did not come up and we are in an import trap. Huge quantities will be required to be imported to maintain the GDP level of 8-9 per cent. Instead, mega coal projects should have been planned with necessary infrastructure. Even if three or four of these had come up, we would not have been in the import trap.

Import of coal

The question comes why India has to import nearly 270 mt at a cost of nearly Rs 1.08 lakh crore at the rate of nearly Rs 4,000 per tonne or more. To handle such a large quantity of import, India has to build port, rail and road infrastructure which may cost another Rs 1 lakh crore. Potentially, this could cripple India's economy. According to Planning Commission data, if sufficient coal as projected is not produced, the country will lose the potential of producing 1,43,000 MW of power. Many parts of India shall remain without electricity and cost of electricity will go up with the consequential inflation affecting all sections of people.

Instead of importing coal of such huge quantities, the country should have concentrated on removal of bottlenecks in infrastructure development (rail, road, power), land acquisition, rehabilitation, speedy EMP/Forestry clearance, and conducive policy framework for improvement of production.

The No-Go areas of MoEF

Our coal requirement by 2030 is likely to cross 2,500 mt. And with the present production level of 550 mt, India has a long way to go. About 90 per cent of all the future projects are facing forest clearance problems. The ministry has to take the decision regarding go and no go projects. The coal occurrence is site-specific and most of it is under forest cover. Do we stop mining altogether or start a fresh initiative of dynamic afforestation? We understand, of late the Group of Ministers (GoM) have relaxed some of the No-go areas for ultra mega power projects (UMPP).

A recent media report has indicated that the no-go criteria is likely to be abandoned by the government in view of acute coal crisis India may face in the near future. Creation of forest may take 30-40 years but deposit of minerals which are site-specific took trillions and trillions of years to occur.

Reason for mega projects

Production programme of some of the coal fields which has the potential of large-scale open cast mining at a favourable ratio of 1:1 in some of the proven reserves:

These coalfields should not have been subdivided into small blocks. Instead, mega projects should have been planned. By 2025, our requirement of coal will be nearly 1,500 mt. Such a steep rise in production will require mega projects and mega Infrastructure network for evacuation.

Advantages of mega projects

The time taken for all the clearances required for a mega project is the same as that of small project. The infrastructure such as rail, road etc, can be planned well in advance. The mechanisation level can be very high and manpower requirement will be much less. The env­ironment management can be managed by a highly skil­led team and indeed zero pollution level can be easily done and maintained. The backfilling and post mining restoration of ecology or the mine closure plan can be done in a far better way. The corporate social respon­sibility (CSR) activities and other needs of local popul­ation can be met due to higher profitability.

Where else can we plan Mega Projects?

Some of the old coal basins like Jharia Coalfields which has been worked out in the past by underground methods and have been abandoned and/or languishing in loss can also be successfully worked by large opencast machinery up to a coal to OB ratio of 1:20 as coal is likely to be very costly (If the cost of coal is say Rs 5000/T) in near future and working at a ratio of 1:20 (coal to OB) may also be economical.Other basins are the Mugma Field that consists of Shyampur basin and Badjna to Kumardhubi basin etc. There could be other basins in the central coalfields like Karanpura coal basin and Gevra Kusmunda coal basin of South Eastern Coalfields.

Some of these basins had been worked for last 100 years or more by underground methods. The coal loss in some of the seams is as much as 70 per cent. The basins are ravaged by slaughter mining, underground fires and many habitations over these are in danger of collapse. All of them can be converted into mega opencast projects after the habitation is resettled and they will be viable even up to a ratio of 1:20.

Jharia Coalfield

This coal field is our main depository of coking coal. It has been exploited by underground mining for last 100 years resulting in 65 mine fires and large coking coal res­erves blocked by mine fire. The townships of Jharia, Katras and Kirkend are in danger of collapse. If the pop­ulation is shifted to non-coal bearing areas near Dhanbad and the coalfield is converted into a few mega projects, the country will have the added advantage of getting sufficient coking coal as well as thermal coal to meet all our future demands.

We have to import the coking coal up to 100 mt by 2020 and the present cost of $400 per tonne may touch $800 per tonne level in near future. Can our economy bear such an astronomical cost? If a fraction of this astron­omical cost is utilised in evacuating the townships of Jharia and neighbouring townships the whole area can be divided into say 8-10 mega projects.

By working Jharia coalfields by mega projects, not only coking coal shortage will be met, the washery midd­lings and rejects from its washeries will meet huge power deficit of the country by building peripheral UMPP.

The government has already sanctioned nearly Rs 10,000 crore for rehabilitation of the affected town­ships like Jharia and others. All that needed is to extend it further to rehabilitate all the townships and free the land for mega projects. As all the mines are prior to 1998, no major hurdle is likely to come from MoEF.

Future Opencast Technology is based on high cap­a­city heavy earth moving machinery (HEMM). In a mega project, the high capacity HEMM can be deployed succ­essfully with very little manpower.

Draglines of 122 cu m bucket capacity with 128 m boom length; Rope shovels of up to 63 cu m capacity presently manufactured in the world can be used; hyd­raulic shovels with 50 cu m bucket capacity, and dumpers with 360-400 tonne payload and dozers up to 860/1,250 HP are the maximum sizes of HEMMs available worldwide.

Coal India has already procured and inducted 42 cu m shovel and 240 tonne dumpers at Gevra OCP of SECL producing now 35 mt and likely to increase up to 50 mt. The current average stripping ratio (CIL) of aro­und 1.8 cu m/t is likely to increase to around 3 cu m/t during the next one decade.

Once we open mega projects with deployment of extra large earthmoving machines, which will extend up to higher depths with increased stripping ratio. We can increase our stripping ratio up to 10 cu m/t for another 2-3 decades.
 
Infrastructure planning

The mega project planning should be inclusive of infrastructure planning of the whole coalfield/coal basin or the mega coal mine. The involvement of Planning Commission, Ministry of Coal, Ministry of Railways, Ministry of Power and Ministry of Environment should be involved in the in the mega project planning.

Indeed, Coal India must have an infrastructure subsidiary company for a large-scale development of infrastructure. Comprehensive R & R policy can be evolved for such mega projects. Comprehensive plan including R & R package can be sanctioned in one 'go'. New and modern townships can be built. Handsome R & R package can be given to PAPs. Employment oppo­rtunities created.

Conclusion

Only mega projects as described above can solve our coking coal as well as thermal coal shortage. Unless we plan mega projects energy security cannot be achieved. The huge shortfall of power will bring misery to India with repeated power cuts. Even steel and cement sector growth will come down sharply and in turn it will harm India incalculably. The poor will become poorer as huge outflow of foreign exchange will make the country poor. The GDP will go down sharply. India will become vulnerable against China and other super powers. In short, India will remain a poor and backward country. An infra­structure subsidiary of Coal India should have catered to the needs of the coal industry.

The author is Managing Director, Priya Mining Consultancy and Services, and former Director, Coal India.

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