Coal mining is estimated to account for about 10% of
all human-related methane emissions. Most of the methane is emitted either from
coal beds (coal bed methane (CBM)) or from coal mines (coal mine methane (CMM)
during the process of mining. Methane is associated with coal as a by-product
of the coal formation process. It is trapped in coal beds and released during
and after mining.
Methane from coal beds was treated as
a hazard than a resource. Being highly explosive, coal mines have faced many explosions
in the past due to the presence of methane. Many of the mines in Jharia, Ranigunj,
Karanpura, and Bokaro coalfields have been found to be gassy.
Indian
Coal Scenario
India being the 3rd largest coal
producer in the world holds a good prospect for remunerative CBM and CMM exploitation.
Mining operations had started as back as in the early 19th century. Since 1972,
in the post nationalization scenario of Coal Industry, mining operations have
reached a great height and the country is producing around 400 MT of coal. The
share of production from opencast mines is around 85% and the balance is from
underground mines.
Indian coalfields have limited spatial
extent, which is compensated by presence of large number of closely placed coal
seams. In some of the coalfields of Damodar Valley like Jharia, Raniganj, East
Bokaro and South Karanpura , there are around 25 coal seams and in some cases
it even exceeds 40 with cumulative thickness of over 100 meter. In most of the
coalfields, only few coal seams have been mined/ being mined and a number of virgin
coal seams are lying below the present day work area. Therefore, there exists
large coal resource in virgin seams and also in partly distressed coal seams.
About
94% of the high rank coal occurring in India is located in the coalfields of Damodar
Valley . Some of the mines are gassy and go up to Degree III of gassiness (i.e.
10 M3/t of coal mined or above).
The low quality of Indian
coal (high ash, low calorific value) makes it undesirable for coking coal therefore
most coking coal must be imported. The following table provides statistics on
India 's coal reserves and production.
India
's Coal Resources as on 01.04.2008
Coal
reserves
264 billion tonnes
Lignite reserves
39 billion tonnes
Annual coal production (2007-08)
456 million tonnes
Annual Lignite production
34 million tonnes
Coal mined from open cast
mines
87%
Coal mined from underground
mines
13%
Coal fulfills about 56% of the commercial energy requirement
currently (2008) and of this 90% of coal requirement is produced indigenously.
Available coal reserves will last more than 100 years at the current rate of production.
Coal demand has been increasing at a rate of about 4.8 % per year and is expected
to continue at this rate (IEA, 2002).
(source:
Ministry of Coal, Government of India )
Geological
Location of Coal Fields in India
The coal-bearing
formations of India occur in two geological horizons, the Lower Gondwana (Permian)
and the Tertiary sediments (Eocene-Oliocene) of northeastern India , Rajasthan,
Gujarat , Jammu , and Kashmir . Coal resources are found in 18 major coalfields
in India (GSI, 2004).
Hard coal (anthracite and bituminous)
account for nearly 80 % of the country's proved reserves. The principal deposits
of hard coal are in the eastern half of the country, ranging from Andhra Pradesh,
bordering the Indian Ocean , to Arunachal Pradesh in the extreme north-east. States
of Bihar, Orissa, Madhya Pradesh and West Bengal together account for about 85
% of reserves.
Overview of CMM Emissions
and Projects
Between 1990 and 2001, India 's carbon
emissions increased by 61 percent, a rate surpassed only by China . India 's carbon
emissions are expected to continue to increase throughout the decade. The rise
in India 's carbon emissions is in part due to the low energy efficiency of coal-fired
power plants in the country. High capital costs of replacing existing coal-fired
plants, a scarcity of capital, and the long lead time required to introduce advanced
coal technologies, point to the likelihood that most of India 's highly-polluting
coal-fired power plants will remain in operation for the next couple of decades
(EIA, 2004b).
India 's CMM Emissions
(million cubic meters)
Source
1990
1994
1995
2000
2005
CMM emissions (no utilisation)
763*
957.3
959
1,106
1363
Source: USEPA
(2006)
While there is some drainage of CMM, there are
currently no commercial projects for its recovery or use in India . A $25 million
project of the United Nations Development Program (UNDP), the Global Environmental
Facility (GEF), and the Indian Ministry of Coal seeks to demonstrate the commercial
feasibility of utilizing methane gas recovered before, during, and after coal
extraction. Recovered CMM will be used for power generation and CNG fuel for mine
vehicles. Future results could lead to expanded application of CMM technologies
and approaches at commercial scale.
Policy
Framework and Current Status of CBM in India
There
is no regulation or policy for the development of CMM resources in India , but
India has been attempting to develop its CBM resources for several years. In 1997
the Government of India framed a CBM policy that established the Ministry of Petroleum
and Natural Gas as the CBM administrative agency.
Key elements
of the policy are:
No upfront payment
No signature bonus
No Participating interest of the Government
of India
CBM development blocks allotted through a competitive
bidding process.
A 7-year tax holiday, beginning with
the date of commercial CBM production.
Freedom to market
in domestic market at market determined prices.
Imported
equipment for CBM development exempted from customs duties (Directorate General
of Hydrocarbons, 2004-05)
After it was decided that
CBM would be dealt by the Ministry of Petroleum and Natural Gas, a CBM exploitation
project was formulated by the Directorate General of Hydrocarbons with the help
of the MoPNG. The project envisaged four phases:
Phase
I - Exploration
Phase II - Pilot Assessment and Market
Confirmation
Phase III – Development
Phase
IV - Production.
In the immediate context, only Phase
I was to be considered and, to start with, the shallow depth coal-beds of the
Lower Gondwanas of the eastern and central parts of India were to be offered.
The extent of these beds was of the order of 11,000 km2,
made up of:
2800 km2 in the Raniganj, Jharia, East Bokaro and West
Bokaro coalfields in the Damodar Valley belt (Jharkhand), and
8200 km2
in the Sohagpur and Satpura coalfields of Central India (Madhya Pradesh).
Within
these areas, it was proposed to outline 10 blocks, varying in size from 200 to
500 km2, in consultation with the Ministry of Coal and offer them for international
competitive bidding. Offers included several fiscal and other incentives for the
bidder.
In May 2001, the Indian government for the first
time offered blocks for exploration and production of CBM through an international
bidding process. Reliance Industries, Essar, and ONGC won the bids for the blocks.
The government launched a second round of bidding on nine CBM blocks in May 2003
(USEPA). Eight blocks were awarded to Reliance and ONGC. The Ministry has offered
16 prospective CBM blocks in the first two rounds of bidding covering an area
of around 7,800 square kilometers and estimated to contain 820 billion cubic meters
of CBM resources. Expected total production from these blocks is estimated at
23 Million Standard Cubic Meters Per Day (MMSCMD) at their peak production level.
CBM Blocks
CBM-I: DGH in close interaction with Ministry of Coal (MoC),
carved out several prospective CBM blocks in different coalfields of the country,
generated CBM related data and prepared Information Dockets & Data Packages.
In May 2001, for the first time in the country, Government offered 7 blocks under
1st round of CBM bidding, out of which 5 blocks were awarded and contracts signed.
Contracts for another 3 blocks awarded on nomination basis were also executed.
CBM-II: Under second round of CBM bidding 9 blocks were
offered through international competitive bidding in May 2003 with bid closing
date of 15th October 2003 . A total of 14 bids were received for 8 out of 9 blocks
offered. Contracts for these 8 awarded blocks were signed in June 2004.
CBM-III:
International competitive bids have been invited by Government of India for 10
CBM blocks under 3rd round of CBM bidding with bid closing date of 30th June 2006
. There was an overwhelming response to the CBM-III round of bidding. For the
first time major foreign E&P companies participated in the CBM-III bidding
round. 70 nos. of data packages valued Rs. 10 crores (approx.) were sold and a
total of 54 bids were received for all the 10 blocks, from 26 companies including
8 foreign and 18 Indian companies. All the 10 blocks received multiple bids.
More than 75 exploratory (test) wells have been drilled
in the awarded blocks. The Directorate General of Hydrocarbons recently offered
an additional 10 CBM blocks during a third round of open international competitive
bidding that closed in June of 2006. The following table represents the blocks
that have been awarded till date (May 2008).
