MINE CLOSURE REPORT FOR BHURKUNDA OPEN CAST PROJECT (CENTRAL COALFIELDS LIMITED) AUGUST 2012 Regional Institute – III Central Mine Planning & Design Institute Ltd. (A Subsidiary of Coal India Ltd.) Gondwana Place, Kanke Road Ranchi-834008, Jharkhand 1 INTRODUCTION 1.1 About the Mine Bhurkunda Colliery, also called as Sangam OCP, having an area of about 10.0 sq.km. faliing in the South Karanpura Coalfields (Barkakana area of CCL) is under active exploitation since 1929. Initially it belonged to Railways, in 1956, NCDC took over it. It was reconstructed with a view to exploit thick quarriable Argada seam. There has been repetition of Argada and other seams due to several strike faults traversing in the property. Between two subsequent faults, Argada seam, the thickest seam of the area, has been worked out by opencast method in quarry no. 5, quarry no. 1, quarry no. 3 & quarry no.4 and quarry no. 2 (Sangam Project) is now being worked. 1.1.1 Name of mine owner / company Project--------- Bhurkunda OCP Area------------ Barka Sayal Area Company------Central Coalfields Limited Mine Owner---Director (Technical)(Operation), CCL 1.1.2 Address for Communication Project-------- Bhurkunda OCP Nearest Railway station ----- The nearest Railway heads is Bhurkunda on Barkakana Dehri-on-sone-Gomoh broad gauge loop of Eastern Railways, about 4 km south from southern end of Bhurkunda block. District--------- Hazaribagh. State-----------Jharkhand. 1.1.3 Location of mine: Project--------- Bhurkunda opencast project is situated in the south eastern part of the south Karanpura Coalfields and is in Barka Sayal area of Central Coalfields Limited. The proposed Bhurkunda East OCP lies in the eastern part of Bhurkunda Colliery lease hold and is being planned to work the older four seams, which was not intended to be worked in the PR of Bhurkunda OCP sanctioned earlier, viz, Argada-A to Argada B seams. The adjoining mines are: North – Gidi-A East – Lapanga South – South Bhurkunda West – Saunda-D Area------------ Barka Sayal Area Latitude-------- 23030’ to 23058’ North 2 Longitude------ 84046’ to 85028’ East 1.1.4 Life of mine: Estimated remaining life of mine (as on 01.04.12) ------ 20 years 1.1.5 Total Lease Area of the mine :------ 777.83 Ha 1.1.6 Communication The mine is about 10 km west of the eastern limit of South Karanpura Coalfields and falls within Hazaribagh district of Jharkhand. The nearest Railway heads is Bhurkunda on Barkakana Dehri-on-sone-Gomoh broad gauge loop of Eastern Railways, about 4 km south from southern end of Bhurkunda block. It is connected with Ramgarh by a 20 km long metalled road. Ramgarh is well linked with various important places such as Ranchi, Hazaribagh etc. 1.1.7 Topography of the area The Damodar river and the major nalas joining it constitute the main drainage system of the area. The Nakari nala constitutes one of the major source of water and is formed by the confluence of many rivulets originating from the hill ranges lying south of Bhurkunda block. The Nakari nala demarcates the western boundary of Bhurkunda block. The area is gently undulating. On the south of Bhurkunda block are two hill ranges trending NW-SE and coverage at Baragaon. Of these, the Baragaon- Ghaghra range constitute the highest in the region, being about 1050 m above HSL and is about 10 km south east of the block. On the north east of the block runs the Bundu hill range trending NW-SE, the maximum height of it is about 460 m above MSL. The ground elevation of the proposed quarry ranges from 338 m to 381 m. 1.2 Reasons for Closure To restore the disturbed area after extraction of planned quantity of coal, to the acceptable limit of local community and regulatory authority. 1.3 Need of mine closure planning 1.3.1 Mining activities leave long lasting impacts on the landscape, ecology and on local inhabitants. These activities disturb the delicate environmental and social equilibrium that exists in its area of influence. Hence, it becomes imperative on part of the mine operator to restore the equilibrium in the mine affected area that existed in the pre-mining period. Thus, any mining venture must have adequate closure plan, aimed at rehabilitation of disturbed area, which should be acceptable to local community as well as regulatory authority. 3 1.3.2 Mine closure encompasses rehabilitation process designed to restore physical, chemical and biological quality disturbed by the mining activities. Mine closure is not just something that happens at the end of a mine’s life rather mine closure is an ongoing series of decisions and activities beginning in the pre-mining stage of mine and ending with a sustainable site that can be returned to the community. 1.3.3 Thus, a Mine closure plan needs to define the liabilities, responsibilities and authorities of the different agencies like the mine management, other regulatory bodies, Central and State Governments after mine closure. Various objectives of the advance mine closure planning are as follows: a. To allow productive and sustainable after-use of the site, which is acceptable to the mine owner and the regulatory authority b. To protect public health and safety c. To eliminate environmental damage and thereby encourage environmental sustainability d. To minimize adverse socio-economic impacts of mining activities e. To protect the flora and fauna of the area affected by the mining f. Effective use of the assets created in course of mining 1.3.4 Primarily, the mine closure activities are planned in two stages. The initial plan identifies the activities required to be executed as the mining activities progress after the inception of the Project. These activities may undergo subtle changes depending upon the actual site condition during implementation. Finally, a detailed closure plan is to be prepared 4-5 years before the actual closure time of the mine depending upon the existing parameters at that point of time. Plans Enclosed The following surface plans have been enclosed along with this mine closure report plan: a. Pre mining Land use plan of core zone b. Quarry & Dump Plan at the end of mining. c. Post mining land use plan with reclamation. 4 Financial Provisions Mine Closure activities of Bhurkunda OCP would be a constant exercise for the mine which would begin with the commencement of mining operations and continue till post closure. The mine closure activities would naturally entail certain expenditures, which will have to be borne by the mine operator. 2.1 Revenue expenditures This would cover the activities which are being executed along with normal mining operation and would continue to be executed in course of execution of the Project. The cost of progressive mine closure activities is already part of the project cost. 2.2 Expenditures to be incurred just prior to actual mine closure and in the post closure period 2.2.1 As per MOC guidelines, a corpus escrow account @ Rs. 6.0 lakhs per Ha of the property leasehold shall be opened with the coal controller organization to meet the expenses of final mine closure. Thus the total expenditure on his front may be calculated in following manner: The cost expenditure after closure of mine will be met from the corpus escrow account deposited by the mine operator. However, the additional amount beyond the escrow account will be provided by the mine operator after estimating the final mine closure cost five years prior to mine closure (as per the mine closure guideline). The progressive mine closure will deal the land reclamation as per the calendar plan of project report. The cost of progressive land reclamation is already part of the project cost. Therefore, the escrow account for mine closure will deal only the final mine closure. The detail of escrow account The total mine lease area is 777.83 Ha, so the corpus based on August, 2009 rate is Rs. 4666.98 Lakh @ Rs. 6.0 Lakh/Ha of lease area. The wholesale price index in August, 2009 and April, 2012 is 129.60 and 163.50 respectively. So the current value of corpus is Rs 4666.98x163.50/129.60 Lakh, which comes to Rs. 5887.74 lakh. The provision for mine closure expenditure made in the accounts of 2010-11 and 2011-12 for Bhurkunda OCP is 872.18 Lakh. So the net corpus has become Rs. (5887.74 – 872.18) = Rs. 5015.56. Since this is an operating/existing mine, this corpus is to be divided by balance life of mine. The balance life of the mine is 20 years. So, by dividing by 20 years, 5 the annual corpus comes to Rs. 250.78 Lakh. This amount is to be deposited in escrow account every year with 5% escalation. ESCROW ACCOUNT Bhurkunda OCP 1) Current value of Corpus (Total project 5887.74 areax6x163.50/129.6, fig. in Rs. Lakh) 2) Provision for MCP made in the accounts 872.18 of 2010-11 and 2011-12 (in Rs. Lakh) 3) Net corpus for MCP ( Total corpus - 5015.56 Provision made in the accounts of 2010-11 and 2011-12) (in Rs. Lakh) 4) Balance Life of mine as on 1.4.12 (in 20 years) 5) Annual corpus (Net corpus / Balance life, 250.78 in Rs. Lakh) Year Amount in Lakh (Rs.) 1 250.78 2 263.32 3 276.49 4 290.31 5 304.83 6 320.07 7 336.07 8 352.87 9 370.51 10 389.04 11 408.49 12 428.91 13 450.36 14 472.88 15 496.52 16 521.35 17 547.42 18 574.79 19 603.53 20 633.71 Total 8292.25 As per above an amount will be deposited every year up to the last year of mine life.