Ministry of Coal issues guidelines for preparation, formulation, submission, processing, scrutiny, approval and revision of mining plan for coal and ignite block

Jun 02, 2020 | by Avantis RegTech Legal Research Team


Industry Specific Compliance

The Ministry of Coal on May 29, 2020 issues Office Memorandum (OM) prescribing guidelines for preparation, formulation, submission, processing, scrutiny, approval and revision of mining plan for coal and ignite block. It prescribes that all coal (including lignite) mining operation shall be governed as per modified guidelines. The format and the detailed guidelines are enumerated in Annex-I of the OM.

The OM broadly covers host of guidelines for the mine owner and the mining operations which has been covered in detail under various guidelines mentioned below:

1. Mining Plan:

(a) implementation of improved mining plans shall be sole responsibility of the mine owner. Mining operations shall be undertaken in accordance with duly approved mining plan which would be valid for the balanced life of the mining life and can be modified only with the approval of competent authority.

(b) Mining Plan shall cover prescription for different phases of life of the mine as stage plan. The stage plan for 1st to 5th years i.e at the end of mine life and post closure   shall be submitted at the lime of initial submission of mining plan. The project proponent shall submit a report or information consisting of compliance status, stage plan for next five years, revised balance life of the mine, revised calculation of ESCROW amount with respect to revised balance life to coal controller Kolkata.

(c) The mining plan approved prior to issue of this guideline will qualify for the submission of such report or information at least 180 days prior to the expiry of 5 years from the date of notification of Mineral Concession Amendment Rules, 2020.

i.Statutory obligations: Mining Plan should indicate the legal obligations and compliances thereof, if any, which the lessee is bound to implement, like special conditions imposed while execution of lease deed as prescribed by various regulatory authorities.

ii.Mine Closure Plans: It will have two components viz. i) Progressive or Concurrent Mine Closure Plan, and ii) Final Mining Closure Plan. Progressive mine closure plan shall be prepared for a period of every five years from the beginning of the mining operations which would be examined periodically in every five years period and to be subjected to third party monitoring by the agencies approved by the Central Government. Mining is to be carried out in a phased manner along with reclamation and afforestation work in the mined-out area.

iii.Abandonment cost: The total cost for carrying out various project specific activities shall be estimated for assessment of abandonment cost of the mine involving progressive and final mine closure activities.

iv.Escrow Account Calculation: The escalated rate for closure cost (based on the current base year i.e. 01.04.2019) is Rs. 9 Lakh per hectare in open cast and Rs. 1,50,000 per hectare for underground Mine. These rates will be considered as Base Rate to be applicable from 01.04.2019, and the rates may stand modified based on Wholesale price index (WPI) as notified   from time to time by the Government of India.

v.Financial Assurance: The Mining Company or Mine Owner as a part of Financial Assurance will open a Fixed Deposit Escrow account, with the Coal Controller Organization (on behalf of the Central Government) as exclusive beneficiary prior to commencement of any activities on the land/project area of the mine and shall submit the same to Coal Controller Organization (CCO) before the permission is given for opening the mine.

2. It further prescribes for Formulation of Mining Plans by Qualified Person (QP) or accredited Mining Plan Preparing Agency (MPPA). It also provides a detailed procedure for submission, processing and scrutiny of Mining Plan.

[Office Memorandum No. 34011/28/2019-CPAM]


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