SAIL, BCCL sign MoU to jointly develop two coking coal blocks in West Bengal

Steel Authority of India Limited (SAIL) and Bharat Coking Coal Limited (BCCL) have signed a Memorandum of Understanding for the joint development and operation of two coal blocks in West Bengal, a move aimed at improving domestic raw-material availability for the steel industry.

The arrangement covers SAIL’s Indikatta Ramnagore Coal Block and BCCL’s East of Damagoria (Kalyaneshwari) Coal Block. Together, the blocks have a combined peak rated capacity of 4.0 million tonnes per annum, while Phase I is estimated to hold around 79 million tonnes of extractable reserves.

The agreement proposes an integrated mining model in which coal extraction and overburden management will be coordinated between the adjoining blocks. Under the proposed arrangement, mining in the Kalyaneswari block will be accompanied by overburden dumping in the Ramnagar block, with the arrangement reversed in Phase II.

The MoU is aimed at increasing domestic coking coal production and developing indigenous sources to support the country’s steel industry, reinforcing BCCL’s stated strategy of expanding domestic coking coal availability and supporting import substitution for Indian steelmakers. Since India imports nearly 90% of its metallurgical coal, joint mining with BCCL represents an important step towards strengthening raw material security for domestic steel manufacturing.

BCCL, a Coal India subsidiary, operates mines in the Jharia and Raniganj coalfields and has washing capacity for converting raw coal into higher-quality washed coking coal for steel-sector customers. SAIL is already among BCCL’s major customers, with SAIL, Damodar Valley Corporation and Uttar Pradesh Rajya Vidyut Utpadan Nigam together accounting for 57.52% of BCCL’s revenue from major customers in FY2025-26. The new arrangement could deepen this existing commercial linkage between the two central public sector enterprises while giving SAIL greater visibility over domestic coking coal supply.

The project comes after a weaker FY2025-26 for BCCL, when revenue from operations declined to Rs 13,644.78 crore from Rs 15,917.21 crore a year earlier. The proximity of the West Bengal blocks to SAIL’s core plants is expected to yield logistics savings and support operating margins over the coming fiscal cycles.