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Adani Group Masters The MDO Model in India

This is the first among the four MDO contracts which the Adani Group bagged. This also marked Adani Enterprisesu2019 entry into the resource business vertical in India. It also led to an increase in Adani coal import.

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Adani Group Masters The MDO Model in India

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  1. Adani Group Masters The MDO Model in India

  2. Adani Enterprises, which is the flagship company of the Adani Group and also a global integrated business player, announced the commencement of its integrated coal mine developer cum operator operations in 2013. This was done with the start of coal production at the Parsa East-Kente Basan mine in Chhattisgarh. This coal mine was initially owned by Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL), which is a state-run power generation utility of Rajasthan. This is the first among the four MDO contracts which the Adani Group bagged. This also marked Adani Enterprises’ entry into the resource business vertical in India. It also led to an increase in Adani coal import.

  3. Adani’s Initial Mining Ventures As MDO: The Adani Group had initially outlined a phased capital outlay of INR 3,000 crore for the entire block at the Parsa East-Kente Basan mine. With this development, the Adani Enterprises took one step ahead towards becoming the largest private coal miner. It acquired access to produce coal of up to 90 million tons and reserves of over 3 billion tons for the next 30 years. This is enough to produce around 18,000 MW of electricity by the electricity boards. The project also contributed significantly to Adani coal import.

  4. Gautam Adani, the chairman of the Adani Group, earlier mentioned that the commencement of mining at the Parsa East-Kente Basan mine is a milestone achieved by the Adani Group in the mining sector. With this, the group will be able to take a huge step ahead towards bringing about energy security in the country. The Parsa East-Kente Basan mine block is located in Chhattisgarh. It was awarded to RRVUNL in 2007. It then issued the tender seeking MDO services. This contract was bagged by Adani Enterprises. The contract is currently being executed by Adani Mining which is a wholly-owned subsidiary of Adani Enterprises.

  5. The Concept of MDO: MDO is a relatively new concept in India. It is a concept where in a coal block owner contracts entire operations to a third-party. The third party takes responsibility for various mining operations including land acquisition, resettlement and rehabilitation, mining, developing and operating the mine by making investments in it and then supplying the coal at a tender-determined price to the power plants of the mind-owning state electricity board. By mastering this concept, the Adani Group has been able to rise to the position of being one of the biggest players in the country’s mining sector. It has also been able to bring about a significant improvement in Adani coal import.

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