MANGROL: Mining and Thermal Power Plant

Sector – Industries

Nishant Alag, R.Sreedhar, Rajesh Kapoor

Prepared for the Government of Gujarat

Supported by World Bank under Non-Lending Technical Assistance on Strengthening and Transformation of Institutions for Management Land Acquisition and Resettlement and Rehabilitation

CONTENTS

1. Overview of Energy Sector in Gujarat 1

2. Lignite Power Plant (SLPP) and Captive Vastan Mines 2

3. Institutional Efforts 5

4. Concluding Remarks 6

Annexure I - Power Projects In Gujarat - Installed Capacity Of The State 7 Annexure I A - Capacity Addition During 2007-2012 8 Annexure 2 - Demographic Characteristics of Villages around SLPP – Mangrol Taluka, District Surat 9 Annexure 3 - Agriculture, Economy and Land Utilisation in Villages Around SLPP 10

1.0 OVERVIEW OF THE ENERGY SECTOR IN GUJARAT

The state of Gujarat is seeing an unprecedented growth1. Rapid industrialisation over the years has raised the demand for reliable electricity supply. Currently the state has a total installed capacity of 9612 MW2. The gap is of course widening with the pace of industrial approvals and thus the need for electricity. The GoG has an ambitious plan for capacity addition of 11164 MW by the end of 2012 using a mix of thermal and gas based power generation.

Electricity Generation in Gujarat (March ‘08) Fuel Based Classification Capacity (MW) % Gas 1889 19.65 Oil 220 2.29 Coal 4525 47.08 Lignite 715 7.44 Hydro 779 8.10 Coal/Gas 500 5.20 Gas/Naptha 305 3.17 Nuclear (central sector) 559 5.82 Unallocated quota from central sector 120 1.25 Total 9612 100 Source: EPD

The power policy realizes the fact that ‘The State has tremendous geographical advantage for port based power plants using imported coal or liquid fuel like LNG, Naphtha and natural gas. This potential has remained largely unexploited till now. In building the future perspective for power development in the State, this potential is going to play a very important role’.

The capacity addition during the 11th plan is also envisaged over the next four to five years to give a boost to the energy sector. Coal is seen as the major focus for capacity addition. 59% of the total capacity addition of 11,164 MW is to be met through coal (see figure3). Despite the fact that the state has limited lignite deposits to open up for energy generation and potential for hydropower is also limited, preference for coal, despite its high cost is being explored.4 Lignite deposits are available in Districts of Kutchh, Bharuch, Bhavnagar and Surat.

GSECL is the energy generation agency5 in the state and GUVNL is the holding company. The electricity distribution business is operated through four regional companies (North, South, Central and Western).

2.0 SURAT LIGNITE POWER PLANT (SLPP) AND CAPTIVE VASTAN MINES

GIPCL was incorporated in 1985 as a public limited company under the auspices of Government of Gujarat to produce electricity. Currently the company has two power stations located in Vadodara and two units located in Mangrol, District Surat.

1 Growth rates have been over 10% in the last four financial years 2 See Annexure I 3 See Annexure IA for details 4 The cost of coal in Gujarat comes to an average of Rs.1436.5 per MT compared to Rs.710 per MT for Maharashtra, Rs.730 per MT for Rajasthan and Rs.400 per MT for Madhya Pradesh (Power Policy, Gujarat) 5 GSECL is a power generation company promoted by the erstwhile Gujarat Electricity Board

1 Table 1: GIPCL Units in Gujarat S.No. Plant Unit Fuel Capacity (MW) 1 Vadodara Station I Gas 145 Station II Gas/Naptha 160 2 Surat Lignite Power 2 units – 1X 125 MW Lignite 250 Plant, Mangrol SLPP Expansion Additional 2 units Lignite6 250 (Phase II) under construction Source: GIPCL & www.sebi.gov.in/dp/gujarat.pdf

SLPP is an integrated unit with its two power units, mining lease as well as the residential colony and was commissioned in the year 1999. The total land acquired for the three components i.e. plant area, ash disposal area and colony is approximately 1600 Hectares.

The current lignite requirements are met from the captive mines at Vastan located 7kms SW of Mangrol and the power plant is located 2kms SE of the mine on SH65. The plant is based on Circulating Fluidized Bed Combustion (CFBC) Boilers technology, which is supposedly relatively eco-friendly.

Table 2: Production Details of Surat Lignite Power Plant 2 x 125 MW Financial Year Particulars Units 2005-06 2006-07 2007-08 Generation MU 1874.13 1751.94 1878.541* PLF % 85.58 80.00 85.54 Availability Factor % 87.97 83.13 87.76 * Highest ever since commissioning

The company is in the process of acquiring additional land (table 3) for expansion of SLPP to double the existing capacity of the plant. The existing captive mine at Vastan is linked to the power plant through a conveyor belt (3km running length) and this arrangement has proven cost effective due to negligible transportation cost. It is estimated that (considering all the three mines) these mines have sufficient reserve for fuelling a 1000MW capacity power plant over the next 30 years. The most important feature of this expansion is that all the three mining leases are contiguous and form a large land tract, which will be used for mining operations and ash disposal.

6 The total reserves of lignite are estimated close to 2100 million tones and the mineral is spread in the District Kutch, Surat, Bhavnagar and Bharuch.

2

Vastan Mine, SLPP – Mangrol

Table 3– Lease Detail & Characteristics of Mineral Blocks, Mangrol & Valia Taluka Location Area Approximate Extractable Overburden Stripping allocated affected Reserves Ratio (hectares) villages (MT) Vastan, Distt. Surat 1,536 11 42 512 1:12 (existing) Mangrol – Taluka, 1,210@ 8 126 691 1:6 Distt. Surat Valia-Mangrol, 857 (510 for 7 44 266 1:6 Distt. Surat Valia (expansion) section & 347 for Mangrol section) Total 3,603 26 212 1469 Source: GIPCL & MoEF: @ in-principle approval from GoG

The annual intake of lignite is estimated at 1.2 MT per annum with a strike length of 6kms and is free of any geological disturbances. The other advantage is that no blasting is required as the overburden and interburden consists of alluvium and soft gypsiferous & fossiliferrous variegated clays.

The original village settlements were not acquired but the agricultural lands in the vicinity of the village were acquired by the company. Village Vastan, Nani Naroli, Surali are among few villages in close vicinity of the plant and mine.

3

Vastan Lignite Mine

SLPP

N

Villages Around SLPP

SLPP is one of the first to adopt CFBC technology to control air emissions and electrostatic precipitators for control of particulate matter. Although mining of lignite leaves behind lots of overburden and plant operations result in huge amount of fly ash generation which continue to provide challenging issues for the company. It is estimated that 1 tonne of lignite produces around 12 Cu.M of muck/overburden, as one has to stockpile this overburden over a specified land zone. Similarly average daily flyash7 generation is about 5000 T. The open cast Vastan lignite mine is managed by preserving the fertile top soils and spreading them over the back filled portion of the

7 The trust has established flyash brick manufacturing units for their plant/mining area consumption and for village infrastructure improvement. The company also sells flyash to willing buyers to manufacture bricks in the hinterland.

4 mine. Flyash utilization is among the priority areas of the company, almost all the flyash generated from SLPP is used for construction of mine roads, bricks and back filling of lignite mines. One of the concerns of backfilling with flyash is that over a period of time, leaching might take place and it may interfere with the groundwater systems.

The risk sometimes is that this stockpile may erodes/slide depending on maintaining specified angle of repose. The team involved in mining also acknowledges the fact that there are few instances where such incidents take place and if these incidents impact surrounding settlements, those are compensated accordingly.

3.0 INSTITUTIONAL EFFORTS

DEEP is a Trust promoted by GIPCL since 1996. While GIPCL’s core competence and business is mining and electricity generation, DEEP8 on the other hand works towards development programmes in the eleven programme villages around the plant9. There is one designated officer who looks after LA and community development.

This zone around Mangrol has witnessed tremendous interest of companies for mining and industrial projects, which has also resulted in competitive environment as far as land prices are concerned. In an instance, GMDC offered Rs. 3.83 Lakhs/ha and subsequently GIPCL had to raise the amount to Rs. 4.50/ha as people expected higher price than the already offered price in the region.

Around 500 blocks of land was acquired by GIPCL of which 429 blocks belonged to people i.e. private land. DEEP adopted the strategy of one-to-one counseling10 with the people of the area who were to loose land. With the expansion of SLPP, the people are expecting a competitive price11, the belief is that even the earlier compensation was substantial but with the growing demands and rising prices elsewhere, price of land shall be based on the prevailing rates.

The consultation strategy adopted by DEEP was two fold i.e. initial briefing of the issue with the panchayat and villagers and finally adopting individual interactions to reach to a consent award.

The trust receives funds from GIPCL and initiated community programmes over the years. A programme named ‘ Integrated Development of Mineral Bearing Villages (IDMBV) was initiated in 11 programme villages.

The basic objective of the programme is to enable communities, especially those living below poverty line, to bring about significant and sustainable improvement in health and education with special focus on livelihoods.

S.No Focus Area Approach 1 Promoting CBOs Empowerment of rural communities. Formation of SHGs with thrust on training & savings. (8 SHGs) 2 Employment Initiated Mini Community dairy project in 2006 in collaboration with government departments 95 beneficiaries covered by providing 2 cattle each and linked to SUMUL dairy.

8 DEEP (Development Efforts for Rural Economy and People) is a Trust registered under the Bombay Public Charitable Trust’s Act, 1950 9 See Annexure III 10 Discussions with CEO, DEEP 11 As per discussions with Md. Abdullah, Deputy Sarpanchy, Masoli

5 S.No Focus Area Approach 3 Improving The focus is mainly on improving/creating quality physical infrastructure infrastructure like drinking water, school infrastructure improvement, village infrastructure improvement like CC roads & compound wall for schools.

DEEP has spent almost over Rs. 12 Crores over the last decade on community development and physical infrastructure development. The trust also collaborates with government agencies for undertaking improvement of infrastructure in the region by ensuring high quality norms in their execution.

Neither the company nor the trust has come across any resettlement and rehabilitation issues. While there is no stated policy, with the proposed expansion there is a need to understand the interlinkages of agricultural land, homestead and livelihoods. One of the positive aspects is that GIPCL has been encouraging DEEP for its work and allocate funds requested by the trust.

4.0 Concluding Remarks

The expansion project is in continuity to the existing project and spans across the tribal Taluka of Mangrol and Vastan.

• There might be some cases where the earlier land losers may again loose land. This needs to be handled with great sensitivity. There has to be a specific social assessment so that a strategy is adopted for covering risks as the impact area expands.

• Opening up of information kiosks to disseminate relevant information on land, status of application, community programmes should be proactively adopted.

• Transparency should a company policy as it will determine the process and method and can lead to negotiated settlement through mutual consent.

6 Annexure I POWER PROJECTS IN GUJARAT - INSTALLED CAPACITY OF THE STATE (31ST MARCH 2008) Sr. No. Name of Fuel Derated Capacity In MW GSECL 1 Dhuwaran TPS Gas 219 1A Dhuwaran TPS Oil 220* 2 Ukai TPS Coal 850 3 Wanakbori TPS Coal 1470 4 Gandhinagar TPS Coal 870 5 Sikka TPS Coal 240 6 Kutch Lignite TPS Lignite 215 7 Utran TPS ( NEW ) Gas 135 8 Kadana Hydro Hydro 240 9 Ukai Hydro Hydro 300 10 Ukai LB Hydro Hydro 5 11 Panam Hydro Hydro 2 Sub Total : 4766 IPP 1 A.E.CO./Torrent Coal / Gas 500 2 GIPCL - Vadodara Gas/ Naphtha 305 3 GIPCL - Mangrol Lignite 250 4 Essar Power Gas 300 5 GPEC - Paguthan Gas 655 6 GSEGL - Gas 156 7 GMDC Stage I Lignite 250 Sub Total : 2416 CENTRAL SECTOR (Gujarat Share) 1 NPC - Tarapur APC & TAPP #4 Nuclear 434 2 NPC - Kakrapar APC Nuclear 125 3 NTPC Corba Coal 360 4 NTPC Vindhyachal -1 Coal 230 5 NTPC Vindhyachal -2 Coal 239 6 NTPC Vindhyachal -3 Coal 266 7 NTPC Kawas Gas 187 8 NTPC Zanor Gas 237 Sub Total : 2078 1 Sardar Sarovar - SSNNL Hydro 232 TOTAL : 9492 2 Gujarat share from unallocated quota 120 from central sector Grand Total 9612 *314 MW -Capacity was reduced in 2007-08 due to derating and retirement of Dhuvaran units vide CEA/513 dtd 20/04/07

7 Annexure IA CAPACITY ADDITION DURING 2007-2012 S. No. Power Project Fuel Capacity Year wise addition (in MW) during 11th Plan 2007- 2008- 2009- 2010- 2011- 08 09 10 11 12 1. Dhuvaran CCPP, GSECL, Gas 472 112 360 - - (St#2) - (St#3) 2. KLTPS Unit IV GSECL Lignite 75 75 - - - - 3 Utran CCPP Gas 360 - - 360 - - 4 Sikka TPS (Stg-II) Coal 500 - - - 500 - 5 Ukai Extension (Unit #6) Coal 490 - - - - 490 6 SLPP Stage II GIPCL Lignite 250 - 250 - - - 7. Pipavav - CCPP Gas 700 - - 350 350 - (#1) (#2) 8. Hazira - CCPP Expn. Gas 350 - - 350 - - 9. Mundra - TPS(CBR) Coal 1000 - - 1000 - - 10. Ghogha, GPCL Lignite 500 - - - - 500 11 South Guj (NLC-GPCL JV Lignite 900 - - - - 900 12 Chhatisgarh (CBR), Adani Coal 1000 - - - - 1000 Power 13 Vadinar (CBR),ESSAR Coal 1000 - - - - 1000 14 (Pipavav) Coal 900 - - - 900 - 15. Sugen CCPP Gas 990 660 330 - - - (#1& (#3) #2) 16 (NTPC) Vindhyachal Coal 133 133 - - - - Stage-III 17 NTPC Kahalgaon Stage II Coal 141 141 - - - - 18. Aryan Coal Beneficiations Coal 200 - - - 200 - Pvt Ltd.(CBR) 19. NTPC Barh Coal 260 - 87 87 86 (#3) (#1) (#2) 20. NTPC North Karanpura Coal 231 - - 77 77 (#2) 77 (#3) (#1) 21. NTPC, Sipat Coal 712 239 316 157 - - (StII) (St I) (St I) (#1& (#3) #2) Total 11164 1360 983 2741 2113 3967

Source: Energy and Petrochemical Department

8 Annexure 2: Demographic Characteristics of Villages around SLPP – Mangrol Taluka, District Surat

Area No of Total SC SC SC ST ST ST S.No Village name (Hec.) Households Population Male Female Population Male Female Population Male Female 1 Harsani 364.21 245 1134 565 569 0 0 0 1134 565 569 2 Timbarva 373.9 75 353 177 176 0 0 0 349 175 174 3 Bhilvada 792.96 417 1887 958 929 16 8 8 1717 872 845 4 Dansoli 393.19 185 912 478 434 0 0 0 670 354 316 5 Nani Naroli 1794.91 1094 6220 3224 2996 178 92 86 2493 1300 1193 6 Vastan 479.74 181 1268 990 278 0 0 0 428 198 230 7 Surali 498.63 81 394 192 202 0 0 0 391 191 200 8 Vadoli 511.86 155 732 362 370 0 0 0 547 263 284 9 Shah 779.72 255 1246 644 602 0 0 0 0 831 429 10 Masoli 413.16 652 3405 1762 1643 117 54 63 1176 619 557 11 Jhankharda 415.35 120 572 301 271 2 1 1 333 169 164 12 Dungri 348.63 568 2515 1253 1262 71 35 36 1875 934 941 13 Nagama 426.43 184 830 439 391 0 0 0 575 309 266 14 Charetha 364.37 17 109 59 50 0 0 0 0 0 0 15 Mangrol 901.72 1040 5354 2744 2610 208 106 102 2482 1278 1204 TOTAL 8858.78 5269 26931 14148 12783 592 296 296 14170 8058 7372

Around 53% tribal population around SLPP. Similar is the trend at the district and Taluka level. In Mangrol taluka of Surat District, almost 53% of the population is of tribals. Similarly in Valia Taluka of Bharuch District, around 74% tribal population is noticed.

9 Annexure 3: Agriculture, Economy and Land Utilisation in Villages Around SLPP Total Area not Income irrigated Unirrigated Culturable* available for S.No Village Name Production in Rs.'00 Expenditure area area waste cultivation 1 Harsani Jowar, Cotton & Pulses 1471 1454 5.1 288.79 36.64 33.68 2 Timbarva Jowar, Cotton & Paddy 0 0 5.1 295.06 34.92 38.82 3 Bhilvada Jowar, Cotton & Paddy 899 895 36.37 655.04 63.14 38.41 4 Dansoli Cotton, Sugarcane, Tuwer 3207 3194 33.41 286.36 0 73.42 5 Nani Naroli Sugarcane, Jowar 830 728 135 1038.65 121.54 499.72 6 Vastan Jowar, Pulses, Paddy 0 0 33.78 44.78 33.93 367.25 7 Surali Sugarcane, Jowar 0 0 95.2 218.73 21.83 162.87 8 vadoli Sugarcane, Jowar, Paddy 220 220 78.95 370.4 0 62.51 9 Shah Jowar, Pulses, Sugarcane 696 696 47 341.48 39.82 351.42 10 Masoli Jowar, Pulses, Cotton 1656 1654 18.38 331.72 59.75 3.31 11 Jhankharda Jowar, Pulses, Cotton 126 125 125.95 261.72 14.44 13.24 12 Dungri Jowar, Cotton, Sugarcane 290 340 55.15 226.48 66.9 0.1 13 Nagama Sugarcane, Wheat, Jowar 850 850 109.04 265.2 40 12.19 14 Charetha Jowar, Sugarcane 0 0 55 105.84 18.26 185.29 15 Mangrol Jowar, Pulses, Cotton 18085 18141 65.6 685.65 98.34 52.13 TOTAL 28330 28297 899.03 5415.9 649.51 1894.36 *including gauchar and groves

Most of the villages have similar cropping pattern with two to three crops i.e. jowar, cotton, pulses and sugarcane. Most of the agriculture is rainfed in the region. The total irrigated area forms only 10.15% of the total land, whereas 61.13% remains unirrigated and rest of the land is either not cultivable or dedicated to gauchars and groves.

Tribal Population in Valia and Mangrol Taluka District Taluka Total Area Total Tribal % of tribal Villages (Sq.kms) Population Population population Bharuch Valia 96 514 130587 96179 73.65 Surat Mangrol 94 511 171524 90370 52.69 Source: http://guj-tribaldevelopment.gov.in/location/tablea.htm

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