**Summary:**
The Ministry of Coal has highlighted the benefits of underground coal mining, emphasizing its advantages in environmental impact, land use, and social considerations. Underground mining minimizes surface disturbance, reducing damage to infrastructure, agricultural land, forests, and habitation areas. Environmentally, it generates less dust and noise pollution than opencast mining and is suited for extracting higher quality, deep-seated coal reserves. A smaller surface footprint results in lower indirect greenhouse gas emissions. Underground mines are also less susceptible to weather disruptions, enhancing operational safety.
To promote underground coal mining, the government has amended the methodology for auctioning coal and lignite mine blocks, introducing specific incentives. These include reducing the floor percentage of revenue share and waiving the Upfront Amount for bidders participating in auctions of mines reserved for underground mining. Successful bidders are prohibited from converting underground mines into opencast or mixed mines.
The share of underground coal production in the country's total coal production has seen a decline over the past five years: 5.54% in 2019-20, 4.50% in 2020-21, 4.26% in 2021-22, 3.90% in 2022-23, and 3.44% in 2023-24. To enhance this percentage, coal companies are adopting mass production technologies, embracing Mine Development and Operation (MDO) projects, and re-operationalizing abandoned underground mines through MDO under a revenue-sharing model.
This information was provided by Union Minister of Coal and Mines Shri G. Kishan Reddy in a written reply in Lok Sabha. The press release was issued by PIB Delhi on August 6, 2025.
Key Entities Referenced
Ministry of Coal: The Indian government ministry responsible for coal and lignite resources.
Underground Coal Mining: A method of extracting coal from beneath the Earth's surface through tunnels and shafts, as opposed to opencast mining.
Lok Sabha: The lower house of the Parliament of India, where the information was presented.
Shri G. Kishan Reddy: The Union Minister of Coal and Mines who provided the information.
Mass Production Technology: A technological advancement for enhancing coal production in underground mines.
Mine Development and Operation MDO: Projects related to mine development and operation, often through revenue-sharing models.
Delhi: The location where the press release was issued. Delhi, India
coal and lignite minesblocks: Blocks of land containing coal and lignite deposits, offered for auction.
Ministry of Coal
Benefits of Underground Coal Mining
Posted On: 06 AUG 2025 3:37PM by PIB Delhi
Underground coal mining offers several advantages, particularly from environmental, land-use, and social
perspectives. Since underground mining causes minimal disturbance to surface features, it results in reduced
damage to infrastructure, agricultural land, forests, and habitation areas.
From an environmental standpoint, underground mining generates significantly less dust and noise pollution
compared to opencast mining. It is also well-suited for extracting deep-seated coal reserves, which are often
of higher quality. Moreover, underground mining leaves a smaller surface footprint, thereby contributing to
lower indirect greenhouse gas emissions associated with land degradation and loss of vegetation.
Additionally, underground mines are generally less susceptible to adverse weather conditions such as heavy
rains or flooding, which can disrupt surface mining operations. This makes underground mining relatively
safer throughout the year due to varying climatic conditions.
The Government has taken steps to promote underground coal mining. In this regard, the methodology dated
28.05.2020 for auctioning coal and lignite mines/blocks for the sale of coal/lignite on a revenue-sharing basis
has been amended vide order dated 23.04.2025 to provide specific incentives for underground mines. These
include:
1. Reduction of the floor percentage of revenue share to 2%.
2. Complete waiver of the Upfront Amount.
These incentives apply to bidders participating in the auction of coal or lignite mines reserved for
underground mining. The successful allocates under this category, availing the above benefits, shall not be
permitted to convert the underground mine into an opencast or mixed mine at any stage during the life of the
mine.
The proportion/share of coal production from underground mining in the total coal production of the country
during the last five years is given below:
% share of UG production in the total coal
Year
production
2019-20 5.54%
2020-21 4.50%
2021-22 4.26%
2022-23 3.90%
2023-24 3.44%
Further, to enhance percentage share of underground mining, along with steps as mentioned at Para(b) above,
taken by Government, coal companies have undertaken steps such as adoption of Mass Production
Technology, embracing Mine Development and Operation (MDO) projects and re-operationalization of
abandoned/ discontinued underground mines through MDO under revenue sharing mode.
This information was given by Union Minister of Coal and Mines Shri G. Kishan Reddy in a written reply in
Lok Sabha today.
****Shuhaib T
(Release ID: 2152985)