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The Indian Government has announced plans to offer eight coal mines for auction in January 2016 in a bid to boost production.

Coal secretary Anil Swarup told media that the country aims to increase coal output to 1.5 billion tonnes this decade.

The blocks are planned to be offloaded to private steel, cement and electricity companies, which are expected to have as much as 500 million tonnes (Mt) of coal production capacity a year by 2020.

Cancellation of the practice involves assigning of the mines to private companies on a selective basis by the Supreme Court. In September 2014, the government was compelled to sell them through auctions.

Reuters reported that companies such as Adani Power and the GMR Group have won coal mines in three rounds of auctions.

"These mines are expected to have total reserves of 1,143 million tonnes."

As part of the fourth round of auction, mines in the Indian states of Madhya Pradesh, Jharkhand, Maharashtra and West Bengal would be put up for auction, Swarup said.

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Together these mines are expected to have total reserves of 1,143Mt, with peak production estimated at 12.9Mt.

Swarup was quoted by The Times of India as saying: "It has been decided to auction eight Schedule III coal mines earmarked for non-regulated sectors like iron and steel, cement and captive power plants in the fourth tranche.

"The e-auction for these mines will be held from 18 January to 22 January 2016."

In a separate announcement, India’s cabinet has cleared the sale of another 10% interest in Coal India and expects to raise $3bn.

Image: Coal mines in Madhya Pradesh, Jharkhand, Maharashtra and West Bengal would be put up for auction. Photo: courtesy of dan/