Output of CIL to touch 1 bn ton in four years

Output of CIL to touch 1 bn ton in four years

A roadmap has been prepared by Coal India Limited (CIL) to substantially enhance production of coal to 1 Billion Tonnes of Coal by 2019-20 from the production level of 494.23 Mte. Achieved in 2014-15.

As on 1st February, 2016, the coal stock was 42.25Mte. compared to 39.05 (Provisional) Mte as on 1st February, 2015. Thus, there is an increase of 3.2 Mte. of coal stock.

The quantum of unsold coal lying with CIL as on 01.02.2016 is 42.25 Mte. (Prov). Supply of thermal coal to power sector by CIL was 385.61Mte against a target of 405 Mte in 2014-15. During 2015-16 (April – January, 2015-16), supply of coal to power plants by CIL was 337.01 Mte. (Prov.) against the target of 352.29 Mte.which is 96% of the target. CIL is able to meet the current demand and TPPs have comfortable coal stock position of 36 MT equivalent of 24 days requirement as on 22.02.2016.

To facilitate liquidation of pit head coal stock CIL has offered 10 MT and 4 MT of coal under special e-auction to Power Sector and Non-Power sector consumers respectively, in line with directions of Government. Subsidiaries of CIL have also been advised to make all out efforts to enhance despatches through all modes to consumers as per commitment, the Minister added.

Coal Linkages to Private Companies

As per New Coal Distribution Policy (NCDP), 2007, Standing Linkage Committee (Long-Term) [SLC (LT)] is authorized to recommend the Letters of Assurance (LOAs) for supply of coal. Based on the SLC (LT)’s recommendation, so far 177 LOAs have been issued to various power plants including Central/State Government Sector as well as IPPs (Independent Power Producers i.e., private companies) covering capacity of 108000 MW.

READ  If one firm goes, others will come: Piyush Goyal on Posco’s exit offer

Out of this 1,08,000 MW capacity, the competent authority in 2013 had approved signing of Fuel Supply Agreements (FSAs) in respect of 78,000 MW capacity power plants which have been commissioned or are likely to be commissioned by 31.03.2015.

It has also been decided that coal may also be supplied to power plants of 4660 MW capacity and other similarly placed power plants that do not have any fuel linkage subject to the availability of coal and on the condition that such supplies would not adversely impact the availability of coal for the identified plants of 78,000 MW capacity as per the approval accorded and other LoA holders.

A Presidential Directive to this effect was issued to Coal India Limited (CIL) on 17.07.2013. The power projects of the remaining capacity of 30,000 MW are yet to be authorized for signing of FSAs. Keeping in view the negative coal balance reported by subsidiary coal companies of CIL, new linkages/ Letters of Assurance (LoA) have not been granted to any of the sectors since 2010, Power and Coal Minister Piyush Goyal told the Lok Sabha on March 4th.

Coal linkages/LOAs issued to the Power Producers are converted into Long Term Fuel Supply Agreements after achievement of prescribed milestones. The consumers under the FSA are supplied coal at the price notified by CIL from time to time. This applies to the regulated sectors (like Power Utilities including IPPs, Fertilizers, and Defence). For non-regulated sectors (like sponge iron, cement, steel, Captive Power Plants and other industries), CIL charges a price which is about 35 % higher than the notified price

READ  Coal India arm NLC approves Rs 1,244-crore share buyback plan