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State-owned Coal India Limited is in talks with power companies along the western and eastern coasts to discontinue the use of imported coal “We are meeting the coastal power companies to shift to coal produced by CIL. Some of them have already started that,” director (marketing) of CIL S N Prasad told a programme organised by Bharat Chamber of Commerce here today. He said that these power companies were of the opinion that imported coal was more expensive than domestically produced coal. “They are willing to shift to local coal as it will reduce the cost of generation,” he said. For this, these firms would have to enter into a long-term agreement with CIL, Prasad said.
Regarding growth of coal production during the current fiscal, he said that it would come down to two to 2.25 per cent as compared to nine per cent registered in the fiscal 2015-16. Prasad said that production had been hampered to some extent due to problems in the Talcher mines due to R&R problems. In the last fiscal, CIL production at absolute terms was 536 million tonnes.
Regarding coal supply to power plants, he said that CIL has a stock 100 million tonnes at pithead. “Coal will be available to the power companies on demand. The power plants are having a coal stock of 10 to 15 days,” Prasad said.
Pointing out that CIL still has to address quality issues, the official said that if the buyer agreed for third party validation for which it would have to bear 50 per cent of the additional cost, then it would be done by appointed agencies after which it would be certified by the Coal Controller’s Office.
Out of the 517-odd million tonnes covered under the fuel supply agreement (FSA) with the power sector, 400 million tonnes had been already validated and certified, he said. This scheme of validation would also be extended to the non-regulated sector (like cement) as well and then to e-auction consumers, he said.
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