Bhopal: Coal India has secured its first critical mineral asset, a graphite block located in Madhya Pradesh. This acquisition marks a significant step for the state-owned company in its diversification into non-coal mineral mining.

On Monday, July 22, 2024, Coal India announced that it emerged as the preferred bidder for the Khattali Chotti graphite block in Alirajpur district of Madhya Pradesh. This development is expected to enhance the company’s role in supporting the green energy transition.

Coal India, which dominates the domestic coal sector with over 80% of the national output, has now entered the non-coal mineral mining sector. This acquisition occurred during the second tranche forward auction held by the Ministry of Mines on 9th July. The company won the bid with a mining premium of 150.05% of the mineral dispatch value, which will be paid to the state.

Coal India will receive a formal letter of intent once it deposits the performance security. A composite license will be issued within a year, following the completion of all formalities.

The graphite block was offered in the second tranche of the critical mineral auction. With this acquisition, Coal India is set to play a significant role in the domestic critical minerals sector.

Currently, India imports approximately 69% of its graphite needs, including natural, synthetic, and end-use products. The graphite mining industry, with its limited number of players, presents opportunities for new entrants. Graphite is crucial as an anode material in lithium-ion batteries, which are essential for the growing electric vehicle market and energy storage systems.

The market for graphite is expected to grow substantially, with demand projected to increase by 25-27% by FY35. Previously, the PSU had expressed interest in mining critical minerals, and this move reflects its strategic shift towards supporting emerging industries. /BI