BCCL's strategic moves boost Domestic Coking Coal Consumption
Published: Sep 27, 2024
By TIOLCorplaws News Service
NEW DELHI, SEP 27, 2024: BHARAT Coking Coal Limited (BCCL), a subsidiary of Coal India Limited (CIL) and India's largest producer of coking coal, has made significant strides in reducing the country's reliance on imported coal through its active role in the "Mission Coking Coal" initiative under the Aatmnirbhar Bharat vision.
The import of coking coal puts a burden on India's valuable foreign reserve, and to cutting down on these imports, BCCL has undertaken substantial reforms to make its coking coal auction processes more flexible, transparent, and attractive for the country's steel producers.
One of BCCL's major efforts came after the Tranche VI auction, where none of the offered coal was booked. In response, BCCL reassessed its strategy and made several improvements. Key among them was the introduction of consortium bidding, which allowed smaller consumers to collaborate and participate collectively in the auction, broadening the pool of bidders and making the process more accessible.
In a bid to attract more participants, BCCL proposed amendments to the eligibility norms for linkage auction bidders. The proposal was approved at the Functional Directors' Meeting of BCCL and subsequently forwarded to CIL for further consideration. This proposal included the participation of consortiums comprising steel plants, existing or new coking coal washeries, and other plants capable of consuming the power coal by-products of washeries. CIL quickly embraced this idea, leading to the development of a new Scheme Document for Tranche VII of the Linkage Auction for the steel sub-sector.
Before the official notification of the Scheme Document and to ensure broad engagement, BCCL and CIL hosted a Consumer Meet in Delhi, gathering feedback from steel producers and industry associations. This effort, also coupled with continuous follow-up with potential bidders and proactive engagement, regular communication significantly improved participation in the auction process.
As a result of these initiatives, BCCL achieved record-breaking success in the recently concluded long-term linkage e-auction (Tranche VII) for the steel sub-sector. Of the 3.36 MT of coking coal offered, 2.40 MT was successfully booked, setting a new benchmark in coal bookings.
These efforts by BCCL are poised to significantly enhance the use of domestic coking coal, reduce reliance on imports, and strengthen the steel industry in India. The successful implementation of consortium bidding and clear communication regarding the auction process has ensured higher participation, benefiting both consumers and the country's broader goal of import substitution under the vision of Aatmnirbhar Bharat.
Expressing satisfaction with the success of Tranche VII, CMD, BCCL, Samiran Dutta, said the concerted efforts to make the auction process more inclusive and transparent have paid off significantly. The successful bookings are a testament to commitment to boosting domestic coking coal production and reducing import dependency.
