The Economic Times quoted Coal India official as saying that the coal in the two blocks in Mozambique is not suitable for use by even Indian power plants.
"The reserves in the two blocks do contain carbon, but it is not good enough to be called coal.
"This reserve cannot sustain a 12% rate of return on investment in the medium to long run. Simply put, it is not coal."
The company has so far spent Rs5bn ($80.68m) to explore the reserves.
In 2009, Coal India secured exploration and development rights for the A1 and A2 blocks in Tete province of Mozambique.
The company created Coal India Africana to manage the exploration and production activities and the samples are analyzed in India.
The launch of exploration program was delayed due to some technical reasons. Coal India planned to export coal to India to meet domestic demand for thermal and coking coal.
