Coal news and updates

Coalmin to R-power: Restrict coal output to 16 MT annually only for Sasan

The coal ministry on Wednesday asked Reliance Power to restrict the output from two coal blocks linked to its ultra mega power project at Sasan to 16 million tonne per annum (MTPA) instead of 20 MTPA currently.

In a communication issued to Sasan Power Limited a , which operates the UMPP, the coal ministry said production from the Moher and Moher Amlohri Extension coal blocks in Madhya Pradesh should not be beyond 16 MTPA while catering the fuel needs for the UMPP.

The move comes close on the heels of the ministry de-allocating the Chhatrasal mine on May 7 which was allocated to the company in October 2006.

In asking Sasan Power Limited to restrict output from the two mines, the ministry has cited the Supreme Court’s judgment last year in which the apex court while canceling allocation of 204 coal blocks had spared the mines associated with UMPPs as the benefits are passed on to the people.

But the apex court had ordered that blocks allocated for UMPP would only be used for them and “no diversion of coal for commercial exploitation would be permitted.”

This prompted the coal ministry to have a fresh look at the mines attached to the UMPPs. Reliance Power had won three of the four ultra mega power projects (UMPP).

While it has recently pulled out of the Tilaiya project in Jharkhand, its proposed Krishnapatnam UMPP has also not made much headway. The coal ministry’s move is likely to impact the fortunes of the 3,960-MW Chitrangi power project in proximity to Sasan UMPP which was to be operated partly on the output from the Chhatrasal mine and incremental out put from Moher and Moher Amlohri blocks.

Reliance Power was allowed to use the incremental coal from Sasan in 2008 by an empowered group of ministers under the UPA regime.

The communication mandates Reliance Power to restrict the coal mined from the two mines for Sasan only and that the company must submit a revised mining plan specifying that fuel produced from them would be restricted to 16 MTPA.

source: http://indianexpress.com