Foreign firms may run some CIL mines

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India has identified a few of Coal India's mining projects that could be operated by foreign firms, the coal and power minister said, a step aimed at raising supply from a monopoly that has failed to meet its output target for years.

Coal India, the world's top coal miner, has been hobbled by inefficiency, worker strikes, delays in getting environmental clearance and other issues, leading to coal shortages, which have contributed to utilities' difficulties in providing enough power.

"For augmentation of coal production, a few projects of Coal India have been identified for operation under the mine-developer-cum-operator route, where international as well as domestic operators may take part," coal minister Piyush Goyal told parliament on Thursday.

Goyal said that the government had approved 15 projects for Coal India, with total combined annual capacity of 136 million tonnes, for the five-year plan period of 2012-2017.

Coal India produced 462 million tonnes in the last fiscal year, against a target of 482 million. Goyal has been pushing the company to raise its output quickly to help realise Prime Minister Narendra Modi’s promise of power for all. But given issues such as the difficulties in acquiring land in India, international firms also may find it tough to bring mines into operation. Thiess Minecs, the Indian mining unit of Australia's Leighton Holdings, was brought in to operate a coal mine owned by NTPC, India's largest power generator. But NTPC said in May it had decided to terminate the $267 million contract after Thiess failed to make any progress in developing the mine, even though the development period had been extended twice.

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