Govt allows Coal India to produce gas from coal seams

NEW DELHI: The government on Thursday allowed state-run Coal India Ltd, which is world’s biggest coal miner, to produce coal bed methane from in its existing coalmines, Coal Minister Sriprakash Jaiswal said.

The existing laws prohibit CIL to explore and produce methane from coal blocks held by the company because extraction of coal is regulated by the coal ministry while CBM is under control of the oil ministry, government officials said.

After initial reluctance, the oil ministry has recently accepted CIL’s right over CBM trapped in the coal blocks held by the state-run company, officials said.

The oil ministry initially wanted to auction all blocks for CBM exploration, but after discussion with the coal ministry, it later realized that multiple operatorship will not only be inefficient but also risky as coal mines are susceptible to collapse, officials said.

“It is better that CIL should also explore CBM because it knows the topography of each coal mines,” one official said. There decision ends the protracted turf war between the coal and oil ministries because the former holds rights over coal mining and later controls oil and gas resources including CBM.

CBM RESOURCES

Prognosticated CBM resources of India: 92 tcf

Established: 8.92 tcf

Blocks awarded: 33

Blocks relinquished: 12

Block commercially producing: 1

Commercial output: 0.25 mmscmd

Expected output by 2016-17: 4 mmscmd