New Delhi, Dec. 30: The Centre has decided to annul the fourth tranche of its coal mine auction in which nine blocks were supposed to be put on the block next month because of a very poor response from bidders amid falling commodity prices worldwide.

"We have not got a sufficient number of bids to carry on with the coal block auctions. We received 15 bids for nine blocks... so in view of this, we had to annul the process," coal secretary Anil Swarup told reporters here.

Officials said of the 15 bids, three blocks had fewer than three bidders each. The technical bids for the coal blocks were due to be opened on January 4. The e-auction for these mines was to be held between January 18 and January 22. Two of the nine mines are in Bengal: Jaganathpur A and B.

Two mines are in Jharkhand (Bundu and Gondalpara), two in Maharashtra (Gondkhari and Khappa), two in Madhya Pradesh (Suliyari and Brahampuri), and one in Chhattisgarh (Bhaskarpara). These mines together have reserves of 1,143.42 million tonnes.

Swarup said the coal mines were earmarked for non-regulated sectors such as iron and steel, cement and captive power plants, which have been impacted by adverse market conditions.

The coal secretary blamed the lacklustre bidding on weak demand and pressure on the steel and aluminum industry, which consumes most of the coal within the country.

"It appears that the bidders, especially those from the steel sector, will not be able to make the financial commitment now because of the general state of the market," he added.

The secretary said the government would wait for the right time to resume the auction of these mines.

In August last year, the Supreme Court declared the process of allotting 153 coal blocks between 1993 and 2010 as "arbitrary" and flawed. It later went on to scrap all the allotments, ordering the government to farm them out through an auction process.

The government has carried out three auctions and allocated 31 coal blocks. Another 42 coal blocks were allocated, mostly to state-run entities.

Only nine mines are in operation at present, but the government believes more will start operations next year with production from these mines expected to yield a production of 40-50 million tonnes.

The Centre has estimated that the potential revenue generation from the 73 mines that have either been auctioned or allotted at Rs 3.44 lakh crore during the lifetime of the mine for the coal-producing states.

The revenue that will accrue to the coal-bearing state from the auction of 31 blocks is estimated at Rs 1,96,698 crore. Another Rs 1,48,275 crore will accrue to the states from the allotment of 42 mines.

Most of the schedule III coal blocks have not been exhaustively explored, and bidders view the assessments carried out by government agencies with a great deal of scepticism.

With reserve prices set at around Rs 500 per tonne for some of the blocks, as seen in the last round of auction, the forward auction would only add to the total costs. The winners also face challenges with respect to land acquisition and environmental clearances before they can put the mines into operation.

Sources said bidding interest was strong for the schedule II coal blocks that were auctioned in the first few rounds. These blocks had proven reserves and the private players had some idea about the quality of coal.