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CIL to offer additional coal to power sector in October
October 13, 2011: In order to ensure greater availability of coal for power sector, the Ministry of coal has decided that Coal India Ltd (CIL) will offer some of the meant for sale through e -auction to power sector during the current month (October), a ministry official said on October 13.
This will be made available against already concluded Fuel supply Agreements (FSA) on 'as is where is basis', the official said, adding that the power utilities will be expected to make their own arrangements for lifting and transportation.
As per policy, 10% of the total available quantity of coal is kept for e-auction and this move by the ministry is expected to help the power sector to overcome the temporary shortage of coal.
Confirming the development, CIL chairman N.C. Jha told ICMW, "We will offer around 4 million tons of coal to the power sector in October, which was earlier reserved for e-auction. However, they will have to make their own evacuation arrangements. The interested companies will have to confirm the offer within the next 15 days and will also have to deposit the money by then."
Jha said the additional offering will go to power sector at notified price and no premium will be charged.
Asked if CIL will suffer a notional loss by not selling coal through e-auction as it generally commanded a premium of 60-80% over the notified price, Jha said, "There will be no loss to CIL. We generally offer 4 million tons coal for sale through e-auction route, which is 10% of the total production as per New Coal Distribution Policy (NCDP) and we will offer the additional coal for sale through e-auction in November."
To a query, Jha, "There will be no further sale of coal through e-auction in October. Whatever quantity has been offered till now will be delivered, but there will be no further offering this month."
It may be pointed out here that Coal Minister Sriprakash Jaiswal took stock of the coal availability for the power sector on October 12 with senior officials and CMDs of government coal companies.
The minister directed the officials to increase immediately loading of coal from 153 to 180 rakes per day. Out of these, 145 rakes will be supplied to the power sector only.
Source: ICMW
