Proposed framework for MDO in Coal mining

The proposed framework for development and operation of coal mines through MDO would be as follows:

5.1 Project Report

The Company would prepare an abridged Project Report which shall be provided to the prospective bidders. The report would, inter alia, contain details regarding:

(a) Geological structures of the mine including strike, dip, faults, seam description, details of dirt-band, seam quality, etc.;

(b) description of mine including quarry boundary, mineable reserves, life of the mine, calendar plan of excavation, etc;

(c) coal handling arrangements including storage, loading and despatch;

(d) coal washery arrangements including storage, loading and dispatch;

(e) civil construction including buildings, roads and culverts, etc.;

(f) broad specification Heavy Earth Moving Machinery (HEMM);

(g) Project Information :-

SUMMARISED DATA

A. General :

1. Name of the Project : DRD Opencast

2. Coalfield : East Bokaro Coalfield

3. Location : Bokaro District, Jharkhand

4. Company : Central Coalfields Limited

5. Address of the Company : Darbhanga House, Ranchi PIN- 834029

6. Nearest Railway Station : Phusro and Jaragdih Railway Station Eastern Railway.

7. Roads : The Gomia– Phusro – Jarangdih – Jaina More road passes through the mine

and joins the Dhanbad – Bokaro – Ramgarh NH - 23 in the south east of the coalfield at Jaina More. This road connects the Integrated Karo-Kargali-DRD Mine with Hazaribagh(100Km),Dhanbad(100 Km),Ranchi(150 Km) and Bokaro Steel City(45 Km).

B. Geological Information:

1. General Information:

1. Name of blocks

Integrated DRD Block

2. Area( Sq.Km) 13.50

3. Geological Reserves( Million Tonnes) 1415.71 4. Opencastable Geological Reserves

( Million Tonnes)

1373.32 5 Underground Geological Reserves

( Million Tes)

42.39

6. Seam Considered Kargali Only

61

Peak production capacity (at 115%) Mt 4.60 MTY

Production capacity (at 85%) Mt 3.40 MTY

7 Year of achieving Target Production

(from zero date)

7th year including 4 yrs of construction period

8 Year of start of Internal Dumping No internal dumping proposed

9 Production Phasing ( from zero date upto target year) Mt

Year / Year 3 Year 4 Year 5 Year6 Year7

Coal 1.00 2.00 4.00

OB 1.80 2.10 2.05 4.09 9.10

10 Total Mine life (at nominal production capacity)

Yrs. 23

D. Financial Information

1. Total estimated Initial Capital outlay (updated on June 2013)

(Rs.

Crs.)

2493.19*

*Total Initial Capital includes diversion of Damodar River (Rs. 1549.63 Crs.) and P J Rail (Rs. 315.20 Crs.)

3 Description of coal seams proposed to be worked along with the parting details

E. Summarised data for Washery proposed in DRD OCP

1. Annual throughput capacity : 4 MTY

2. Quality of raw coal feed to the washery :26.7% ash (Washery Grade-III) 3.Capacity and operating conditions of the washery:

Hourly capacity 800 tph

Working days per annum 330

No. of working shifts per day 3

Average daily feed to washery 12250 tonnes 4.Size of raw coal feed to washery :-200 mm 5. Life of the Washery : 18 yrs.

6. Balance of products

:

Product Yield% Ash% Qty. (MTY)

Clean Coal 68 18.5 2.72

Secondary Product 32 44.0 1.28

Total 100 26.7 4.00

7. Capital Expenditure in Rs. Crores :379.57

F. Total Estimated Initial Capital (OCP and Washery): Rs. 2872.76 Crores

5.2 Scope of Work

The selected MDO will develop and operate the mine in accordance with the terms of the Contract Agreement and will deliver the predetermined annual output of coal during the Contract Period.

5.3 Contract Period

The contract period shall be the mine life as per the Project report or 25 years, whichever is less. This life however may vary on the basis of actual production vis-à-vis actual reserves.

5.4 Obligations of the MDO

The MDO shall finance, construct, develop, operate and maintain the mine with a view to achieving optimum excavation of coal. The scope of work will broadly include excavation of rocks and earth cutting and extraction of coal including drilling and blasting (including supply, transportation and storage cost of the explosive), installation and operation of in-pit conveying system, haul road construction, construction and operation of equipment and systems for coal handling, electrical power distribution, loading, transportation, dumping, pumping and drainage of mine water, lighting, fire-fighting arrangement, reclamation of OB dump, construction of

63 related infrastructure facilities (including industrial as well as residential & non-residential buildings), etc. and delivery of coal

The MDO shall also construct a coal washery and undertake coal washing in accordance with the terms of the Contract Agreement. The extent of ash reduction to be achieved by the MDO shall be quantified and specified in the Bidding Documents.

All activities within the mine premises and till the loading of coal in rail wagons as per agreed annual targets shall be the responsibility of the MDO.

5.5 Land

Land acquisition for the coal mines will be undertaken by the Company. However, the MDO shall assist the Company in obtaining the physical possession of the land and in rehabilitation/ resettlement of project affected persons. The Company will bear all costs and expenses related to land acquisition and rehabilitation/ resettlement of project affected persons as per R & R policy of the Company. The responsibility to provide employment to the project affected persons, if any, rests with the Company.

5.6 Environmental aspects

The application for EIA-EMP will be made by the Company, however, preparation of EIA-EMP for the project and obtaining necessary statutory approvals is the responsibility of MDO

The MDO shall comply with the following environmental aspects during the contract period:

• Implement environmental management measures to protect the environment, as per Environment Management Plan (EMP) approved by the Ministry of Environment and Forest (MoEF);

• Comply with all applicable laws, permits and guidelines of MoEF and other State & Central Government agencies;

• Endeavour to conserve resources, minimize waste and improve processes to protect the environment in the course of performing services;

• Provide the services in a manner that will minimize disturbance to local people, livestock, local flora & fauna and adjacent streams under the influence of mining;

• Not trespass the neighbouring property;

• Dispose all rubbish, waste and litter produced in the performance of the services;

• Treatment of sewerage and effluent from residential buildings and service buildings being used by the MDO or its employees.

5.7 Testing of coal supplies

The coal to be delivered by the MDO, shall not contain foreign materials. For ensuring quality prior to delivery, joint sampling in presence of representatives from MDO, the Company and the Consumer will be done. Any deduction due to grade slippage by the consumer shall be deducted from the bills of MDO.

5.8 Mining Plan

The MDO shall conduct its mining operations in conformity with the duly approved mining plan that shall be provided as part of the Bidding Documents. Any amendments to the Mining Plan shall be made with the prior approval of the Company, which approval shall not be unreasonably withheld.

5.9 Safety

The MDO shall submit a detailed safety management plan to the Company for its review and comments. The plan shall, inter alia, comply with the applicable laws and guidelines and conform with good industry practice for safety in mining.

5.10 Security

The MDO shall take the requisite measures to prevent theft of coal. Losses on account of theft shall be borne by the MDO.

5.11 Manpower

The MDO may engage the required manpower on its own terms and conditions and in conformity with applicable laws.