MINE CLOSURE REPORT FOR RAJRAPPA OPEN CAST PROJECT (3.0 MTY) (CENTRAL COALFIELDS LIMITED) JULY 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 Rajrappa opencast mine is located in the Hazaribagh district of Jharkhand. This opencast mine is a part of Ramgarh Coalfield and falls within Lat. 23035’ – 23040’N and Long 85035’-85045’E and is covered by the Survey of India toposheet no. 73-E/10. Damodar River flows over this coalfield. This project is covered by the survey of India toposheet 73-E/10. The Rajrappa OCP forms the eastern part of the coalfield. Details of Mine There are seven sections were proposed to be worked, namely Sec-I, Sec- Ia, Sec-Ib, Sec-2, Sec-2a, Sec-2b and Sec-3 in block I & IV of Rajrappa OCP. These sections are proposed to be worked successively and simultaneously like Sec-I (1st year), Sec-Ia (6th year), Sec-Ib (2nd year), Sec- 2 (6th year), Sec-2a (12th year), sec-2b (16th year) and sec-3 (16th year) as per sanctioned PR. The sequence of mining operations were not carried out as per the sanctioned PR. The bottom seam, VIIB seam has been left in Sec-2 which has to be exploited soon. Working in section-3 could not proceed towards western side (near river Damodar) as planned, due to Chilamtongri village. Mining profile of every sections working in this project is nearly vertical with most of the benches having non-workable width and height. 1.1.1 Name of mine owner / company Project--------- Rajrappa OCP Area------------ Rajrappa Area Company------Central Coalfields Limited Mine Owner---Director (Technical)(Operation), CCL 1.1.2 Address for Communication Project-------- Rajrappa OCP Nearest Railway station ----- Nearest railhead to the project ia the Mael railway station of south –eastern railway, located at a crow fly distance of about 5-6 KM south of the project. The nearest sea port is Calcutta, located at a distance of about 400 Km. District--------- Hazaribagh. State-----------Jharkhand. 1.1.3 Location of mine: Project--------- Rajrappa opencast mine is located in the Hazaribagh district of Jharkhand. This opencast mine is a part of Ramgarh Coalfield and falls within Lat. 23035’ – 23040’N and Long 85035’-85045’E and is covered by the 2 Survey of India toposheet no. 73-E/10. Damodar River flows over this coalfield. This project is covered by the survey of India toposheet 73-E/10. The Rajrappa OCP forms the eastern part of the coalfield. Area------------ Rajrappa area Latitude-------- 23035’ – 23040’N N Longitude------ 85035’-85045’E E 1.1.4 Date of start & Life of mine: Life of mine as per PR ------ 45 years Estimated remaining life of mine (as on 01.04.12) ------ 26 years 1.1.5 Total Project Area :------ 2697.94 Ha 1.1.6 Communication Nearest railhead to the project ia the Mael railway station of south –eastern railway, located at a crow fly distance of about 5-6 KM south of the project. The nearest sea port is Calcutta, located at a distance of about 400 Km. Ramgarh town is situated at a distance of 30 KM from the project site. The project site is linked to the Ramgarh-Dhanbad State Highway by about 5.5 KM long fair weather road. 1.1.7 Topography of the area The topography of the project area is gently undulating to rugged, interspaced with low ridges and valleys, the area is sparsely forested. The topographical elevations within the project area, range between 352 meter and 296 meter. The coalfield is drained by the Damodar river system. The Damodar river dissects the coalfield into two parts. 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. 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 3 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 Rajrappa 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 2697.94 Ha, so the corpus based on August, 2009 rate is Rs. 16187.64 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 16187.64x163.50/129.60 Lakh, which comes to Rs. 20421.91 lakh. The provision for mine closure expenditure made in the accounts of 2010-11 and 2011-12 for Rajrappa OCP is 1185.17 Lakh. So the net corpus has become Rs. (20421.91 – 1185.17) = Rs. 19236.74. 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 26 years. So, by dividing by 26 years, the annual corpus comes to Rs. 739.87 Lakh. This amount is to be deposited in escrow account every year with 5% escalation. 5 ESCROW ACCOUNT Rajrappa OCP 1) Current value of Corpus (Total project 20421.91 areax6x163.50/129.6, fig. in Rs. Lakh) 2) Provision for MCP made in the accounts 1185.17 of 2010-11 and 2011-12 (in Rs. Lakh) 3) Net corpus for MCP ( Total corpus - 19236.74 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 26 years) 5) Annual corpus (Net corpus / Balance life, 739.87 in Rs. Lakh) Year Amount in Lakh (Rs.) 1 739.87 2 776.86 3 815.70 4 856.49 5 899.31 6 944.28 7 991.49 8 1041.06 9 1093.11 10 1147.77 11 1205.16 12 1265.42 13 1328.69 14 1395.12 15 1464.88 16 1538.12 17 1615.03 18 1695.78 19 1780.57 20 1869.60 21 1963.08 22 2061.23 23 2164.29 24 2272.50 25 2386.13 26 2505.44 Total 37816.98 6 As per above an amount will be deposited every year up to the last year of mine life.