You are here: Home » Companies » News
Business Standard

CIL asked to follow PMO directive on pact with power firms

Press Trust of India  |  New Delhi 

Government has conveyed to the Ltd (CIL) that it must follow the PMO direction and sign with the power producers with 80% assured delivery, notwithstanding opposition from several CIL independent directors, sources said.

"The government has made its stance very clear (even though) the decision on 80% trigger is deferred," a high level Coal Ministry official said, adding there is no going back on CIL making commitment on assured supply to the power plants.

CIL has sought more time to work out agreement with the consumers from the power sector.

Against the backdrop of acute fuel crunch faced by power firms, the Prime Minister's Office (PMO) held a meeting with senior representatives of the power firms. It also directed the government-owned CIL to sign the (FSA) with the power firms.

However, the move on assured supply has been questioned by several independent directors of the stock market listed CIL and a UK-based minority shareholder,

Efforts are on to convince the independent directors on the issue, sources said.

As the deadline set by the PMO for signing of the FSA is expiring tomorrow, CIL has asked for more time, sources said.

"The company would need more time to complete the process," they said.

The FSA with assured supply to power plants would mean that if CIL fails to deliver less than 80% of the commitment, it would attract penalty.

First Published: Fri, March 30 2012. 16:33 IST