Your Board of Directors have pleasure to present the Directors' Report together withthe Audited Accounts of the
Company for the year ended 31st March 2017.
The following are the achievements during the year 2016-17
Total overburden removal from all Mines put together at 2058.14 LM3was the highest for any year since inception.
Total Lignite production from all Mines put together at 276.17 LT was thehighest for any year since inception.
Total Power Generation from all Thermal Power Stations put together at 21033.10MU was the highest for any year since inception.
Total Export of Power from all Thermal Power Stations put together at 17719.46MU was the highest for any year since inception.
Total sales turnover of '8672.84 crore was the highest for any year sinceinception.
Profit Before Tax (PBT) and the Profit After Tax (PAT) for the year 2016-17 of'3027.56 crore and '2368.81 crore respectively were the highest for any year sinceinception.
Dividend paid for the year 2016-17 @ 73.40% ('7.34 per equity share) was thehighest for any year since
Segment-wise Performance Mines
Your Company is presently operating four lignite mines viz. three lignite mines atNeyveli in the State of Tamil Nadu and one lignite mine at Barsingsar in the State ofRajasthan with an aggregate capacity of 30.60 MTPA. The detailed Mine-wise performanceduring the year 2016-17 as compared to the previous year were as under:
|Mine ||Overburden > ||OB) Removal (LM3) || |
Lignite Production (LT)
|2016-17 ||2015-16 ||2016-17 ||2015-16 |
|Mine-I including Expansion (10.5 MTPA) ||647.29 ||660.75 ||94.01 ||91.01 |
|Mine-IA (3.0 MTPA) ||421.15 ||246.46 ||27.80 ||28.17 |
|Mine-II including Expansion (15.0 MTPA) ||919.47 ||725.53 ||140.23 ||123.09 |
|Barsingsar Mine (2.1 MTPA) ||70.23 ||70.02 ||14.13 ||12.24 |
|Total (30.6 MTPA) ||2058.14 ||1702.76 ||276.17 ||254.51 |
The lower Overburden (OB) removal in Mine-I was attributable to re-arrangement of benchconfiguration of Mine-I and Mine-IA. Mine-II has achieved the highest ever OB removalwhich was attributable to additional contribution from outsourcing apart from departmentaloverburden removal.
Your Company is presently operating Four Thermal Power Stations at Neyveli Tamil Naduand one Thermal Power Station at Barsingsar Rajasthan. The total power generation duringthe financial year 2016-17 was the highest ever since inception registering a growth of9.65% over the previous year 2015-16.
During the year under review both the units of TPS-II Expansion were understabilisation after provisional take over from BHEL.
As reported in the Directors' Report of the previous years your Company has set itsfootprint in generation of renewable energy
through its Wind Power Plant at Kazhuneerkulam Tirunelveli District in the State ofTamil Nadu and Solar Power Plant at Neyveli. As on the date all the 34 Wind TurbineGenerators (WTGs) of 1.5 MW each have been commissioned and the overall Installed PowerGenerating Capacity of the Company has increased to 3301 MW.
The detailed performance of power plants during the year 2016-17 as compared to theprevious year were as under:
|Power Plant ||Station |
Power Generation (MU)
Power Export (MU)
| ||2016-17 ||2016-17 ||2015-16 ||2016-17 ||2015-16 |
|TPS-I (600 MW) ||70.33 ||3696.70 ||3160.98 ||2968.21 ||2471.68 |
|TPS-I Expansion (420 MW) ||90.71 ||3337.33 ||3268.16 ||3055.32 ||3000.06 |
|TPS-II (1470 MW) ||85.83 ||11052.17 ||10583.15 ||9189.79 ||8836.81 |
|TPS-II Expansion (500 MW) ||31.40 ||1375.25 ||851.46 ||1130.16 ||660.78 |
|Barsingsar TPS (250 MW) ||66.83 ||1463.49 ||1285.57 ||1271.24 ||1102.68 |
|Solar Power (10 MW) ||- ||16.88 ||8.87 ||16.88 ||8.87 |
|Wind Power (45 MW) ||- ||91.28 ||24.02 ||87.86 ||23.14 |
|Total ||73.73* ||21033.10 ||19182.21 ||17719.46 ||16104.02 |
*Plant Load Factor excluding Solar and Wind Power
The average Plant Load Factor (PLF) of the Thermal Power Plants of the Company as awhole during the year2016-17 was 73.73% against the National Average of 59.88%. Eventhough TPS-I crossed 55 years of operation it has achieved PLF of 70.33%. The lower PLFof TPS-II Expansion when compared to the other stations of your Company was due to longeroutage duration of the Units for carrying out certain refractory modification lignitebunker and transfer conveyor modification works etc. Moreover the Discoms during the year2016-17 had surrendered 1307.25 MU and but for this the overall Power Generation couldhave been still higher. The issues relating to the performance of TPS-II Expn. andBarsingsarTPS are being addressed on a continuous basis and in fact the technical problemsfaced in the CFBC boilers in the Units of these plants have been resolved to aconsiderable extent. The Barsingsar Thermal Station had recorded the highest evergeneration since inception and it is expected that both the Plants will be performingwell.
With regard to Thermal Power Station-I (600 MW) while granting exemption from thepurview of Perform Achieve and Trade (PAT) Scheme decommissioning or retirement of theUnits of TPS I by 31st March 2017 was stipulated as one of the conditions. AsMembers may be aware Neyveli New Thermal Power Project (NNTPP) with a capacity of 1000 MWis under implementation for replacing the above TPS-I. Considering the present status ofimplementation and the requirement of TANGEDCO for continuing the operation ofTPS-l tillthe commissioning of NNTPP and furtherthe closure of operations of TPS-I may alsoadversely affect the operations of captive Mines the Company is pursuing with theMinistry of Coal (MoC) as well as the Ministry of Power (MoP) to permit continuing theoperation of TPS-I till March 2019 by which time the Units of NNTPP will become fullyoperational on a sustained basis. MoC has recommended for rescheduling of the retirementof above Plant and to permit the operation till August 2018 and the issue is being pursuedwith MoP requesting for permission to operate the Units of TPS-I till March 2019 oratleastby July/August 2018 for the reasons stated above.
The output per man shift achieved during the year 2016-17 as compared with the previousyear is given below:
|Product ||Unit ||2016-17 ||2015-16 |
|Lignite ||Tonne ||13.67 ||13.08 |
|Power ||kWh ||24341 ||22889 |
Members may be aware that the Indian Accounting Standards (IND AS) was made mandatoryfor reporting of financials of the Company effective from the year 2016-17 and the auditedfinancials for the said year has been prepared in compliance with the IND AS. As per therequirements the financials of the previous year 2015-16 have been restated from the dateof transition to IND AS i.e. 01.04.2015 .
During the year ended 31st March 2017 the Company had registered a totalsales of '8672.84 crore as against '6652.05 crore (restated) during the year 2015-16registering a growth of 30.38 %.
The Profit Before Tax (PBT) and the Profit After Tax (PAT) for the year 2016-17 were'3027.56 crore and '2368.81 crore as against the restated PBT and PAT of '1856.07 croreand '228.00 crore respectively.
The details of Profit earned for the financial year 2016-17 and appropriation of thesame are as follows:
|Particulars ||2016-17 ||2015-16 |
|Profit Before Tax ||3027.56 ||1856.07 |
|Tax Provision ||(214.81) ||721.73 |
|Net Movement in Regulatory Deferral Account ||(873.56) ||(906.34) |
|Profit(Loss) for the period (PAT) ||2368.81 ||228.00 |
|Appropriation: || || |
|Transfer (to) / from Interest Differential Fund Reserve ||(11.12) ||(15.00) |
|Transfer to Bond Redemption Reserve ||(15.00) ||(15.00) |
|Transfer to PRMA Reserve Fund ||(6.84) ||(12.18) |
|Transfer to Contingency Reserve ||(10.00) ||(10.00) |
|Transfer to General Reserve ||- ||(120.00) |
|Transfer to Capital Redemption Reserve ||(149.14) ||- |
|Buy-back Premium ||(1327.36) ||- |
|Dividend (Interim & Final) ||(1121.97) ||(503.32) |
|Tax on Dividend ||(228.42) ||(101.50) |
During the year 2016-17 the Board of Directors of your Company had paid an InterimDividend of 73.40% ('7.34 per equity share) and the same has been treated as the Dividendfor the year 2016-17. The Dividend of 73.40% (previous year 30%) was the highest everdividend paid by the Company since inception and the total dividend outgo for the year2016-17 including distribution tax works out to '1350.39 crore (previous year '604.82crore) which is 57.01% of PAT for the year 2016-17.
Buyback of Equity shares
The Guidelines dated 27th May 2016 of the Department of Investment &Public Asset Management (DIPAM) of Ministry of Finance Government of India had mandatedthe Central Public Sector Enterprises (CPSEs) to consider for restructuring of capitalthrough buyback of shares.
In pursuance of the above guidelines and in terms of the provisions of the CompaniesAct 2013 and SEBI Buyback Regulations the Board of Directors of your Company hadaccorded approval for buyback of equity shares not exceeding 10% of the paid-up equityshare capital and free reserves of the Company as on 31st March 2016 onproportionate basis from the eligible shareholders by way of tender offer process throughthe Stock Exchange mechanism.
In accordance with the above approval 149141173 equity shares of the Company werebought back during March 2017 at a price of '99 per share and post buy-back the paid-upequity share capital of the Company has been reduced to '1528.57 crore from '1677.71 croreand the equity shareholding of the President of India is now 89.32% from the earlierholding of 90%.
MoU with the Ministry of Coal
Your Company had achieved Very Good rating for its performance during theyear 2015-16 in terms of the Memorandum of Understanding (MoU) entered into with theMinistry of Coal as per DPE guidelines.
The details of achievements of MoU parameters for the year 2016-17 based on the auditedresults are as under:
Your Company has achieved a power generation of 21033.10 MU. Power surrender by thebeneficiaries was 1307.25 MU and if the surrendered power is taken into account the powergeneration (gross) for the year 2016-17 would be 22340.35 MU.
Efficiency Parameters (Physical Operation)
The heat rate in Thermal Power Stations (TPS-I TPS-I Expn. TPS-II TPS-II Expn. andBTPS) of the Company during 2016-17 was reduced by 0.64 % as compared to the previous year2015-16 achieving Excellent Level.
The Specific Power Consumption in Lignite Mines of the Company during the year 2016-17was reduced by 6.68% as compared to the previous year 2015-16 achieving Excellent Level.
Output per Man Shift (OMS - Mine-I Mine-IA & Mine-II) for Lignite for the year2016-17 had increased to 13.67 Tonnes/Man shift (Excellent Level) as compared to 13.08Tonnes/Man shift of the previous year 2015-16 registering an increase by 4.51%.
Implementation of Distributed Control System (DCS) was successfully completed on09.07.2016 in Unit-6 of Stage-II of TPS-II (Excellent Level). Belt vulcanising process wasupgraded on 27.12.2016 to improve the productivity and to reduce the downtime by 20%.
Research & Development
Conservation of energy through implementation of Programmable Logic Control (PLC) basedDynamic Loading System in one conveyor system of Mine-II was carried out on experimentalbasis which has registered an energy conservation of 10250 K.whr/month.
Leveraging Net Worth
A target of '5040 crore towards Capex was set for the year 2016-17 to increase theCapacity against the target of '3788.13 crore for the year 2015-16. The Capex target forthe year 2016-17 included '1500 crore towards acquisition of 1200 MW Raghunathpur Plant ofDVC for which approval of Govt. of India is awaited.
Excluding the Capex of DVC the Company had achieved '3569.07 crore as against thetarget of '3540 crore The segment wise break up is as under:
|Segment ||2016-17 ||2015-16 |
|Coal /Lignite Sector ||339.82 ||217.19 |
|Power Sector ||3229.25 ||1168.50 |
|Total ||3569.07 ||1385.69 |
Percentage of value of Capex Contracts/Projects running/completed during the yearwithout time/cost overrun to total value of Capex Contracts/running/completed during theyear was 163.65% at Excellent Level.
Turnover from Operations
The Revenue from operations (Net of Excise duty) for the year 2016-17 was '8672.84crore (Excellent Level). Operating Profit/Surplus
Operating Profit as a percentage of revenue from operations achieved 29.21% (ExcellentLevel).
Marketing Efficiency Ratios
Total Ash Utilisation - (Bottom Ash & Fly Ash) for the year 2016-17 was 91.56 %(Excellent Level).
Trade receivables as percentage of revenue from operations achieved 34.79 % (ExcellentLevel)
Return on Investment
Dividend/PAT % achieved 47.36 % for the year 2016-17 (Excellent Level).
PAT/Net worth % achieved 19.66 % for the year 2016-17 (Excellent Level).
Dividend/ Net worth % achieved 9.31 % for the year 2016-17 (Excellent Level).
Sector/CPSE Specific Targets
Machine Availability in Thermal Power Stations (TPS-I TPS-I Expn. TPS-II TPS-IIExpn. and BTPS) achieved 89.87 % (Excellent Level).
Projects Under Construction/lmplementation
Neyveli New Thermal Power Project (2x500 MW)
Members may be aware that your Company is implementing a lignite based 1000 MW thermalpower project at Neyveli as a replacement to 600 MW TPS-I the oldest lignite fired ThermalPower Station in the Country at a capital cost of ^5907.11 crore with a revised scheduleof commissioning of Unit-I in October 2017 and Unit-ll in April 2018.
The progress of work was slow in the initial stages due to the delay in receipt ofBoiler Main Steel Structures the design of which was unique to this Project involvingcomplicated manufacturing process and also due to delay in starting of engineering &manufacturing activities in the Balance of Plant (BOP) Package. Due to continuousmonitoring and sustained & proactive steps taken to improve the pace of works atvarious levels the project achieved good progress during the year 2016-17. The overallphysical progress improved from 22.39% at the end of 31.03.2016 to 58.65% at the end of31.03.2017 recording a growth of 36.26%. More than 100000 Cu. M. of RCC has been doneduring the year. The capital expenditure incurred during the year under review was?2362.59 crore which was the highest ever and is also indicative of the progress ofworks.
Detailed engineering in respect of Steam Generator (SG) and Turbine Generator (TG)Packages has almost been completed and more than 80% in respect of the Balance of Plant(BOP) Package has also been completed. Major civil works have been completed. Casting ofTG deck was completed in both the Units and Power House has been completed while theerection of various equipment and the piping works are in progress.
In the erection front mechanical works are in full swing. Erection of Boiler MSS wascompleted in both the Units while the erection of pressure parts of Boiler Bunker Bay andother auxiliary structures platforms etc. are in various stages. Erection works in ESPare nearing completion. Lifting of Generator stator in both the Units and threading in ofrotor have also been completed.
In the BOP area erection works in Lignite Handling system Ash handling system CWSystem DM plant etc. are in progress. Raw Water System has been commissioned and 230 KVGIS switchyard is charged.
At the present pace of works and with the continued monitoring to increase the momentumfurther it is hoped that Unit-I will be commissioned in March 2018 and Unit-ll in April2018. The cumulative expenditure incurred in the project upto 31st March 2017is ?4256.43 crore.
Bithnok Thermal Power Project (250 MW) with linked Bithnok Mine (2.25 MTPA)
Your Company is in the process of setting up the Bithnok Thermal Power Project (1x250MW) linked to Bithnok Lignite Mine (2.25 MTPA) in the State of Rajasthan. The Board ofDirectors of your Company has sanctioned the above Thermal Power Project at a cost of?2196.30 crore with the commissioning of the Unit in August 2020. During the year2016-17 supply and installation contract for the Thermal Power Project was awarded toReliance Infrastructure Limited (RIL) Mumbai for setting up the project on EngineeringProcurement Construction (EPC) mode in November 2016 Geo-technical investigation worksfor this project has been completed preliminary/enabling works are in progress. Detailedengineering activities and submission/approval of drawings & Sub Vendors are inprogress. The cumulative expenditure incurred upto 31st March 2017 is ?163.26crore.
Barsingsar Thermal Power Station Extension (250 MW) with linked Hadla Mine (1.90 MTPA)
The Board of Directors of your Company has sanctioned the Barsingsar Thermal PowerStation Extension linked to Hadla lignite Mine at a cost of ?2112.59 crore with thecommissioning of the Thermal Unit in August 2020. Since the Unit size and the technologyadopted was the same a common tender was floated for the Bithnok Thermal Project and theBarsingsar Thermal Power Station Extension Project and Reliance Infrastructure Limited(RIL) Mumbai was awarded for setting-up of the Thermal Plant on EPC mode in Nov 2016.Geo-technical investigation works have
been completed for this project and preliminary/enabling works are in progress.Detailed engineering activities and submission/approval of drawings & Sub Vendors arein progress. The fuel requirement is proposed to be met from Hadla Mine of 1.90 MTPAcapacity and 0.40 MTPA from Barsingsar Mine Extension. The cumulative expenditure incurredup to 31st March 2017 is ?149.97 crore.
Both Bithnokand Barsingsar Extn. Power Projects have been put on hold based on thecommunication received from Govt of Rajasthan and Rajasthan Discoms that they are not ina position to buy power from these projects.
The Committee of Secretaries (CoS) under the Chairmanship of Cabinet SecretaryGovernment of India at the meeting held on 15th June 2017 had reviewed the issues and itwas felt by the Committee that an attempt should be made to reduce the tariff of theprojects and a final view could be taken later. It was suggested to constitute a Committeecomprising of representatives of main stakeholders along with the senior officials ofMinistry of Coal Ministry of Power and CEAto examine the measures required to bring downthe tariff of these projects. The Committee thus constituted held a meeting on 25.07.2017and its deliberations have been sent to the Cabinet Secretariat.
Bithnok Mine Project (2.25 MTPA)
As stated earlier the Bithnok Mine of 2.25 MTPA is being developed with the approval ofBoard of Directors of your Company at a cost of ?513.64 crore to supply lignite to theBithnok Thermal Power Station of 250 MW capacity under implementation. The Mining Plan andthe Mine Closure Plan have been approved by the Ministry of Coal (MoC). The Ministry ofEnvironment & Forest (MoE&F) has accorded Environment Clearance and the action hasbeen taken to obtain the Mining Lease. The Government of Rajasthan (GoR) has accordedapproval for the allotment of 1290.647 ha of Government land including 52.245 ha ofCompensatory Afforestation land. Compliance report for obtaining Stage-ll Forestryclearance submitted. The cumulative expenditure incurred up to 31st March 2017is ?164.88 crore.
Hadla Mine Project (1.90 MTPA)
The Board of Directors ofyourCompany has sanctioned the lignite mine project in Hadla(1.90 MTPA) Rajasthan at a cost of ?522.45 crore to supply lignite to the BarsingsarThermal Power Station Extension Project of 250 MW under implementation. Mining Planincluding Mine Closure plan have been approved by the Ministry of Coal. MoE&F hasaccorded Environmental Clearance. Mining Lease would be obtained after completion of landacquisition for which necessary application has been submitted to the concerned RevenueDepartment of Govt of Rajasthan. The cumulative expenditure incurred up to31stMarch 2017 is ?4.49 crore.
Wind Power Project (51 MW)
Members may be aware that the Company as part of green energy development isimplementing a 51 MW Wind Power Project at Kazhuneerkulam Tirunelveli District TamilNadu at a cost of ?347.14 crore. Leitwind Shriram Manufacturing Limited Chennai theimplementing agency has commissioned 30 Wind Turbine Generators (WTGs) aggregating to 45MW till 31st March 2017 against the total capacity of 51 MW. The balance WTGshave also been commissioned in 2017-18 and all the 34 WTGs are now in operation. Thecumulative expenditure incurred up to 31st March 2017 is ?330.03 crore.
Neyveli Solar Power Project (130 MW)
Members may be aware your Company had earlier set up a 10 MW Solar Power Project inNeyveli which is under operation.
Presently SolarPowerProjectof 130 MWis underimplementation at Neyveli and JaksonEngineers Limited (65 MW) and BHEL (65 MW) have been awarded contacts for setting up thisproject at a cost of ?687.28 crore. Supply of solar modules and major equipment arenearing completion and installation works are in advanced stage of completion. The projectis expected to be commissioned in 2017-18. The cumulative expenditure incurred up to 31stMarch 2017 is ?425.37 crore
Tamil Nadu 500 MW Solar Power Project
In order to enter into renewable energy in a major way the Board of Directors of yourCompany had accorded approval to set up a 500 MW Solar Power Project in various parts inthe State of Tamil Nadu under the Solar Developer & Operator (SDO) Mode. This mode issimilar to that of Mine Developer & Operator mode adopted for developing andproduction in Mines. As per this mode the scope of the SDO Contractor is to procure andtransfer the land to the Company install the equipment Operation and Maintenance(O&M) of the Solar Plant for a period of 15 years. Power Purchase Agreement was signedwith TANGEDCO and the Project is envisaged for commissioning in the year of 2017-18.
During the year under review your Company had placed orders for installation of theabove 500 MW (AC) Grid interactive Solar PV projects to the following agencies with atimeline to commission in 13 months from the date of issue of order at a total projectcost of '2170 crore (including O&M cost):
1. Gamesa Renewable Pvt. Ltd. Chennai - 100 MW Project
2. Harsha Abakus Solar Pvt. Ltd. Ahmedabad - 100 MW Project
3. Jakson Engineers Ltd. Noida - 100 MW Project
4. PES Engineers Pvt. Ltd. Hyderabad - 100 MW Project
5. Marine Electricals (I) Pvt. Ltd. Mumbai - 50 MW Project
6. Refex Energy Ltd. Chennai - 50 MW Project Odisha 250 MW Solar Power Project
Based on the Letter of Intent furnished by GRIDCO Government of Odisha for procurementof 250 MW Solar power under VGF Scheme for a period of 25 years a tender was floated forsetting up the above Project under SDO mode similar to the one adopted in Tamil Nadu.Orders will be placed on the successful bidder(s) on signing of Power Purchase Agreementwith the Govt. of Odisha.
Talabira II and III Coal Block (20.0 MTPA)
Members may be a aware that the Government of India has allotted Talabira-II & IIICoal Block of capacity 20 MTPA in the State of Odisha exclusively to your Company. Thecoal produced from the Talabira-II & III Mines is to meet the fuel requirement of theproposed Odisha TPS and the JV project NTPL. Application has been made to the State Govt.of Odisha to obtain the Stage-1 Forest Clearance (FC) and on receipt of the sameMoEF&CC would be approached for issue of Environmental Clearance. 383.18 acres ofGovt. Non Forest land in Jharsuguda and 91.270 acres of land in village Khinda have beenhanded over to the Company. The Board of Directors of your Company has accordedin-principle approval for the R&R Plan. The work order has been issued to RITES forthe preparation of Feasibility Study Report for the Railway Siding for dispatching coal byRail.
It is proposed to develop and operate the above Mine through the appointment of MineDeveloper & Operator (MDO). Finalisation of tender for the above appointment is inadvanced stage.
Expansion of Mine-I 10.50 MTPA (Area Expansion) & Expansion of Mine-IA (from 3.0MTPA to 7.0 MTPA)
Your Company is implementing area expansion of 10.50 MTPA in Mine-I and Expansion ofMine-IA from 3.0 MTPA to
7.0 MTPA by adding contiguous lignite blocks to meet the fuel requirement of theNeyveli New Thermal Power Plant TPS-I Expansion and TAQA.
Ministry of Coal has accorded approval for the mining plan for the above project andthe Ministry of Environment & Forest & Climate Change (MOE&F&CC) hasaccorded Environmental Clearance. Mine development activities in Mine-IA has commenced andthe cumulative expenditure was incurred up to 31st March 2017 is '209.55 crore.
NLC Tamil Nadu Power Limited (NTPL) - Tuticorin Power Plant (1000 MW)
Your Board of Directors are very happy to inform that the coal based thermal powerproject at Tuticorin Tamil Nadu consisting of two units of 500 MW capacity is gettingstabilised and operating to its full capacity. During the year 2016-17 power generation(excluding surrender of 891 MU) and exported from this plant were 6252.74 MU and 5806.85MU registering the growth of 71.05% and 75.26% respectively over 2015-16. The plantachieved a Plant Load Factor (PLF) of 71.38%. The cumulative project expenditure incurredup to 31st March 2017 is '6625.70 crore.
During the year ended 31st March 2017 NTPL in its first full year ofoperation registered the sales of '2546.93 crore. The Profit Before Tax and Profit AfterTax for the year 2016-17 were '135.28 crore and '87.85 crore respectively.
Neyveli Uttar Pradesh Power Limited (NUPPL) - Ghatampur Thermal Power Project (1980 MW- 3x660 MW) linked to Pachwara South Coal Block
During the year 2016-17 the Government of India sanctioned the Ghatampur Thermal PowerStation Project being set up at Ghatampur Tehsil Kanpur Nagar District in the State ofUttar Pradesh at a cost of '17237.80 crore with commissioning of Unit-I in November2020 followed by other two units at an interval of 6 months each. The project is beingexecuted through the Subsidiary Company Neyveli Uttar Pradesh Power Limited (NUPPL) ajoint venture with Uttar Pradesh Rajya Vidyut Utpadan Nigam Limited (UPRVUNL). All threemain packages (GA1-Steam Generator GA2-Turbine Generator & GA3-Balance of Plant) havebeen awarded during the year 2016-17 and the project construction activities havecommenced. As a fuel linkage to the above power project Government of India has allocatedPachwara South Coal Block in the State of Jharkhand. The cumulative expenditure incurredup to 31st March 2017 is '957.32 crore.
Uttar Pradesh Power Corporation Limited (UPPCL) had signed a Power Purchase Agreement(PPA) for availing 75% of the Power from Ghatampur Thermal Power Project (GTPP) and hadcommunicated their unwillingness to absorb more than 75% of power from GTPP. NUPPL hasrequested to avail the balance 25% power from the Project as per the assurance given bythem to PIB at the meeting held on 08.02.2016 during the consideration of the GTPP.
MNH Shakti Limited
Mahanadi Coalfields Limited your Company and Hindalco jointly formed MNH ShaktiLimited with equity participation of 70:15:15 to implement 20.0 MTPA Coal Mining projectin Talabira in the state of Odisha. The Talabira-II & III Coal Blocks allocated forthis purpose have been cancelled pursuant to judgment of Hon'ble Supreme Court of Indiaand the Coal Mines (Special Provisions) Ordinance 2014. The JV Company has proposed forwinding up and necessary formalities are being worked out by them. The above said CoalBlocks have since been allotted to the Company.
New Coal Block Development
Pachwara South Coal Block (11.0 MTPA)
The Pachwara South Coal Block for a capacity 11.0 MTPA allotted to NUPPL has beenproposed to be developed through the appointment of Mine Developer & Operator (MDO)and the tender floated for the above appointment is in process. In the meantime NUPPL ispursuing through the task force set up by the Government of Jharkhand for issuesconcerning detailed exploration obtaining forestry clearance etc. and for the developmentof the block. Notification has been issued under Sec 4(1) of CBA Act for carrying out thedetailed exploration of the block.
New Projects Under Formulation
Mine-III Project (11.5 MTPA)
Your Company has proposed to develop Mine-III at Neyveli South of Mine-II for acapacity of 11.5 MTPA to supply lignite to the proposed Thermal Station-II SecondExpansion (1320 MW) Project. The Board of Directors of your Company has accorded approvalfor the expenditure sanction of '7.05 crore for the Phase-I Advance Action Proposal (AAP)activities. Mining Plan & Feasibility Report are being prepared and preparation ofEIA/EMP reports are in progress for obtaining
Environment Clearance. Environmental Appraisal Committee of MoEF&CC has approvedthe Terms of Reference (TOR) and Baseline Study & Socio-Impact Assessment (SIA) Studyhave been commenced while the Geo-Technical & Geo-Hydrological Studies are underprogress. Application has been submitted to the District Administration for obtaining theadministrative sanction for acquiring land for the Mine project.
Thermal Station-II Second Expansion (2x660 MW) with linked Mine-III (11.5 MTPA)
Your Company had earlier proposed to set up a 1000 MW Lignite based Thermal PowerStation as TPS-II 2nd Expansion Project (2x500 MW) at Neyveli near MudhanaiVillage (linked to Mine-III of 9.0 MTPA) with sub-critical technology. Based on the normsissued by the Ministry of Power Government of India the Unit configuration was modifiedto 2x660 MW with super-critical technology. The Board of Directors of your Company hasaccorded sanction for the Advance Action Proposal at an estimated cost of '66.85 crorefor taking certain pre-project related activities for this project. Ministry of Power hasgranted exemption from the tariff based competitive bidding for the above project and hasalso allowed to allocate the power from this Project as per the Central formula forallocation of Power to the constituents of Southern region. The Power Purchase Agreements(PPAs) have already been signed with the Southern DISCOMs viz. Tamil Nadu Generation andDistribution Corporation(TANGEDCO) Electricity Department of Puducherry (EDP) KeralaState Electricity Board (KSEB) Telangana State Power Coordination Committee (TSPCC) &Andhra Pradesh Power Coordination Committee (APPCC) and the Power Company of KarnatakaLimited (PCKL) is yet to sign the PPA for the above project. Excepting KSEB all otherbeneficiaries mentioned above have given their consents for the earlier signed PPAs forthe revised capacity of 1320 MW.
The Expert Appraisal Committee (EAC) of MoE&F & CC has considered and issuedthe Terms of Reference (ToR). Environment Clearance is awaited. It is proposed to issuethe Expression of Interest (EoI) for the three Packages viz. Steam Generator &Auxiliaries (SG) Turbo Generator & Auxiliaries (TG) and Balance of Plants (BoP).
Sirkali Thermal Power Project (4000 MW)
Your Company had earlier proposed to set up a 4000 MW coal based thermal power plant atSirkali Nagapattinam District in the State of Tamil Nadu and the administrative sanctionto acquire 1190.59 hectares of land was issued by Government of Tamil Nadu. Since theSirkali Power Project was conceived in the year 2010 with the PPA signed in the year 2011and in the light of allotment of Talabira - II & III coal blocks the economicviability of the Sirkali project was re-assessed in the changed scenario. On assessmentthe cost of power from the proposed pithead Power Plant at or nearby Talabira - II &III including the cost of wheeling of power emerged as a cheaper and environmentallyfriendly alternative instead of transportation of huge quantity of coal by road rail andsea over a distance of around 1650 KMs to the earlier envisaged power plant at Sirkali. Inview of the above it has been decided by the Board of Directors of your Company not topursue the Sirkali Thermal Power Project.
Odisha Pit Head Thermal Power Project (4000 MW)
The Board of Directors of your Company have accorded in-principle approval for theproposal to set up 2000 MW (Phase-1) coal based pit head power station in the proximity ofTalabira-II & III coal blocks in the district of Jharsuguda Odisha. However it isproposed to set up 3x800 MW (Phase-I) with Ultra Super Critical Technology. Advance ActionProposal of '25.11 crore has been sanctioned. Additionally it has been proposed toinstall 2x800 MW as Phase-II in Tareikela and Kumbhari villages of Jharsuguda District.Necessary application for the project has been submitted to the Govt. of Odisha. Consentis being obtained from the Discoms to avail power from this project based on the PowerPurchase Agreement signed for the Sirkali Thermal Power Project.
Acquisition of Power Assets
In order to have an inorganic growth your Company as per the approved Corporate Planaims to acquire power assets of about 3000 MW by the year 2025. EOI was floated foracquisition of power assets. It is proposed to carry out due diligence studies on twoshort-listed power assets viz. GMR Chhattisgarh Energy Limited of 2x685 MW and IndBharath Energy Utkal Limited of 2x350 MW.
Acquisition of Damodar Valley Corporation's (DVC)- RTPS Project (2x600 MW)
As Members may be aware the Board of Directors of your Company had accorded approvalfor the investment for acquiring Raghunathpur Thermal Power Station (RTPS) (Phase I) ofDamodar Valley Corporation (DVC) by forming a Joint Venture Company between your Companyand DVC in the equity participation ratio of 74:26. JVA between your Company and DVC hasbeen signed on 10.08.2016 and the approval of Competition Commission of India for theBusiness Transaction has also been obtained. Approval of the Government of India isawaited for the investment in the JVC for the said acquisition.
SBI Capital Markets Ltd. (SBI Caps) was jointly appointed by DVC and your Company tocarry out necessary due diligence studies on technical legal and financial aspects withemphasis on risk factors & mitigation measures and also to advice both the parties onthe acquisition process. As per the JVA entered into by your Company and DVC the ProjectCost as determined by CERC/ ATE for the purposes of arriving at the final tariff or suchcost as mutually agreed would be the consideration value for the transfer of RTPS Projectassets to the JVC. In this connection SBI Caps has arrived at '7547 crore as the ProjectCost based on CERC Regulation for Benchmark Cost and other norms etc. and the same mayundergo change while determining the final tariff for this Project by CERC.
Renewable Energy Projects
Corporate Plan Vision - 2025 of the Company envisages an addition of 4000 MW Solargeneration capacity in different States and 200 MW of wind based power generation.
Andaman 50 MW Solar Power Project
Tripartite MoU among your Company Ministry of New & Renewable Energy (MNRE) andthe Andaman Nicobar Administration (ANA) has been signed with the objective to plan andimplement a 50 MW Solar based plant in Andaman & Nicobar Islands which will alsosupply power to the proposed pumped storage system for the 5.25 MW Hydro power station inKalpong to cater to the needs of 24 hours power supply to Middle and North Andaman. PPAfor the Project has been signed with Andaman Nicobar Administration.
Initially it was planned to install 20 MW in South Andaman and 30 MW in North Andamanand based on the availability of land and further deliberations the proposal was modifiedto install 20 MW in South Andaman; 23 MW in North Andaman (including 5 MW floating Solar)and 7 MW in Middle Andaman. Tendering activities for installing 20 MW Solar Power Projectswith the cumulative capacity of 28 MWhr of Battery Energy Storage System at South Andamanhave been initiated.
Solar Projects in other States
Your Company has initiated discussions with the State Governments of Karnataka MadhyaPradesh and Andhra Pradesh for setting up Solar Power Projects in the respective Statesand in this regard necessary MOUs have been signed / Letter of Consent has been received.Subject to entering into a Power Purchase Agreement with the respective States and theviability of the Project action will be initiated to set up solar power projects/participate in the solar power parks notified by the State Governments from time to time.
Your Company had earlier floated a tender to set up 130 MW Solar Power Project atBarsingsar in the State of Rajasthan at an estimated cost of '852.57 crore. Projectregistration with Rajasthan Renewable Energy Corporation (RREC) was also completed. SinceViability Gap Funding was not available for this Project it has been decided not topursue this project further.
Roof Top Solar Power Project (1 MW)
Your Company has signed a MoU with Rajasthan Electronics and Instruments Limited (REIL)(Nodal Agency of MoC for Roof Top) for establishing 1 MW Roof Top Solar Power Project onthe non-residential buildings in the township at Neyveli. Further actions are being takento implement this project.
Long-term borrowing & Credit Rating
Your Company had earlier obtained funding of EURO 215.104 Million from KfW Germany forMine-I TPS-I TPS-I Expansion & Mine-I Expansion. Further as part of funding for theMine-II Expansion TPS-II Expansion
Barsingsar Mines & Thermal Power Projects your Company in addition to the issue of8.83% Neyveli Bonds 2009 aggregating to '600 crore had earlier entered into Rupee TermLoan (RTL) Agreements for '3750 crore (RTL-I '2500 crore and RTL-II of '1250 crore) fromthe Canara Bank Consortium. The outstanding amount of '1400 crore from the aboveConsortium was repaid during the year 2015-16 through refinance at a lower interest ratefrom SBI ('467 crore) HDFC Bank ('466.50 crore) and ICICI Bank ('466.50 crore). All theseborrowings have been rated with AAA/Stable indicating highest safety by CRISILand ICRA.
Power Finance Corporation had also sanctioned a RTL of '3000 crore for the NNTPSProject and this has also been rated with AAA/Stable (highest safety) by Brick workRatings. During the year your Company had obtained funding of '481 crore from HDFC Bankat a lower Interest rate of 7.53% for the130 MW Neyveli Solar Power Project (NSPP) inNeyveli and the same has been rated AAA/Stable (highest safety) by CARE Ratings.
Trading of Unrequisitioned Surplus (URS) Power
The beneficiaries continue to surrender their share of power from the Thermal PowerPlants of the Central Generating Stations including your Company due to less demandconditions availability of cheaper power in the market etc.
In order to improve the revenue your Company has started selling this UnrequisitionedSurplus (URS) power in the market from June 2016.
During the year 2016-17 outstanding dues beyond the 60 days limit without levy ofsurcharge stood at '631.21 crore against '406.17 crore for the year 2015-16.
Steps taken by your Company to recover dues in a time bound manner in 2016-17
1. Rebate Scheme
To encourage early realisation a special scheme called Graded RebateScheme was formulated which provides for a graded rebate from a maximum of 2% forpayment within 2 days from the date of billing to 0% on the 60th day ofbilling.
2. Payment Priority Clause
Amendment of Power Purchase Agreement (PPA) for incorporating payment priorityclause for appropriation of receipts was entered into with all beneficiaries (exceptRajasthan Discoms).
As per the payment priority mechanism payment made by beneficiaries will beappropriated in the following order of priority:
> towards late payment surcharge payable if any.
> towards earlier unpaid bill(s) including arrear bills if any
> towards statutory dues like income tax other tax royalty etc. in the currentbill(s) and
> towards other charges in the current monthly bill.
Land Acquisition and R&R Policy
Your Company is following the guidelines issued by Govt. of India from time to time onRehabilitation and Resettlement for the on-going projects with certain enhancementsaimed at minimising the adverse impacts of the projects on the affected people and for thebenefit of the project affected population.
Your Company is sensitive to the painful involuntary relocation of displaced familiesdue to projects of your Company and strives to minimise the trauma of displacement. YourCompany is continuously and consciously balancing the techno-economic and thesocio-economic goals of its projects.
Your Company has developed several Resettlement Centres (RCs) in the vicinity of itsProjects and these RCs are provided with good infrastructure facilities & amenitiesand also well connected to the main roads. The eligible Project affected families havesmoothly resettled in these RCs and have also been provided with rehabilitation measures
in addition to legal compensation for loss of assets as directed by the appropriateGovernment from time to time and with the co-operation of the District Administration.
So far 17121 enhanced compensation cases have been settled in 275 Lok Adalat sittingsand maximum settlement rate in Lok Adalat has been achieved through completecomputerization of the settlement process. Due to these measures your Company has beenfacing the least resistance to Land Acquisition and 1395 Ha. of land has been acquiredsince April 2006.
New Land Acquisition Act
The Government of India (GOI) has enacted New Land Acquisition Act viz.-Right toFair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act- 2013 which is applicable from 01.01.2014. However the Govt of Tamil Nadu hadissued a G.O to continue the land acquisition process under the same Tamil NaduAcquisition of land for Industrial Purposes Act 1997 (Tamil Nadu Act 10/1999) with aprovision for payment of interim compensation subject to payment of final compensation(if any) later as per the new central LA Act 30/2013. Subsequently the Govt. ofTamil Naduhad passed an Amendment Act- Right to Fair Compensation and Transparency in LandAcquisition Rehabilitation and Resettlement (Tamil Nadu Amendment) Act - 2014 toexclude the Industrial Purposes Act 1997 (Tamil Nadu Act 10 of 1999) from the provisionsof the Central LA Act except the provisions relating to the determination of thecompensation and rehabilitation & resettlement. The rules for implementing theprovisions of compensation and R&R benefit of the New Act/amendment are awaited fromGovt. ofTamil Nadu.
Research and Development (R&D)
Centre for Applied Research & Development (CARD) is the In-house R&D Centre ofyour Company. CARD has been granted National Accreditation Board for Testing andCalibration Laboratories (NABL) accreditation for chemical and mechanical testing (forcertain parameters only). This accreditation is based on the international standardISO/IEC 17025:2005 and meets the principles of ISO 9001 that are relevant to scope oftesting services as well as technical competency of the laboratory.
The total R&D expenditure incurred during the year 2016-17 was ?13.35 crore andthe CARD has complied with the MoU guidelines on R&D. Two completed projects are (1)Conservation of Energy thro' implementation of Programmable Logic Control (PLC)based Dynamic Loading System on Conveyor System and (2) Delineation of buriedsub-surface objects in opencast Mines.
Human Resource Management
Your Company takes pride in its competent and highly motivated human resourcesignificantly contributing to the growth and mission of the Company. Your Companymaintains harmonious and cordial relationship among the employees and with otherstakeholders that leads to achieving organisational as well as individual goals. Humanresource has been the backbone of the Company in driving operational and financialperformance. The thrust on achieving higher growth and optimal utilisation of manpowercontinued in the year under review also. The total manpower of the Company as on 31stMarch 2017 stood at 15030.
Your Company is continuously promoting training learning initiatives for skill andcompetency building not only for its own employees but also for the surrounding society.
The training programme and module includes areas of Management Computer functionalareas of thermal and mining skill development safety CSR etc. Envisaging the importanceof skill development among the society especially youths various measures and initiativesare taken under its CSR plan for capacity building and promoting entrepreneurial skill by
imparting training in various trades. During the year 2016-17 596 In-house programmeswere organised covering 25745 employee headcounts.
During the year under review 873 employees were deputed to various Training ProgrammesWorkshops Conferences within India covering 725 Executives 148 Non-executives through281 programmes. During the year 2016-17 11 numbers of Leadership Development programmeswere arranged for the Senior Level Executives.
Your Company provides Apprentices Training every year as per Statutory Guidelines ofthe Regional Director of Apprenticeship Training Chennai (RDAT) and the Board ofApprenticeship Training (BOAT) of Southern Region Chennai.
Your Company continued its faith in participative management and has a regular systemof holding bi-partite structured meetings with the Recognised Unions in addressing thecommon issues of the employees.
Secret Ballot election was conducted by the Deputy Chief Labour Commissioner (Central)for getting elected as the recognised Unions to hold discussions with the Management forthe issues of unionised category of workmen/ non-executives. Accordingly CITU-NLC Labour& Staff Union and NLC Workers Progressive Unions (LPF) have secured votes (Jointly)over 51% and to operate as collective bargaining agents from the year 2016 to 2020.
Your Company won the first runner up of National Award for Outstanding IndustrialRelations (2014-2015) held during May-2016 by the All India Organisation of Employers andthe award was presented by Shri Bandaru Dattatreya Hon'ble Minister for Labour &Employment (Independent charge) Govt.of India.
In general the industrial relations scenario of the organisation remained by and largepeaceful and cordial during the year 2016-17.
Implementation of Official Language Policy
In line with the Policy of Government of India and the provisions prescribed under theOfficial Language Act 1963 your Company made all concerted efforts to implement thePolicy and promote the Official Language. The following events have been carried outduring the year 2016-17:
The Official Language (OL) Implementation Committee of the Company under theChairmanship of the CMD conducted quarterly review meetings for the effectiveimplementation of OL policy. Hindi workshops were conducted on quarterly basis on varioustopics as per the Act besides conducting spoken Hindi classes for 30 working days. HindiFortnight was celebrated in the month of September 2016 and Hindi competitions on varioustopics were held during that fortnight. In order to promote the OL among the employeesHindi regular/correspondence courses Hindi Typewriting courses and personal contactprogrammes were conducted. 281 employees passed under regular courses and 184 employeesunder correspondence courses. 235 employees have enrolled this year for the correspondencecourses and 129 for the regular courses.
The House Journals & e-news are being published in trilingual i.e. Tamil Hindi& English and Annual Reports in bilingual. Hindi version of Company website is beingupdated regularly. Your Company was awarded with the Raj Bhasha Shield - 2016for its excellent performance in the progressive use of Official Language.
Reservation of Posts
Your Company follows the reservation policy for SCs STs and OBCs as per thepresidential directives and the guidelines issued by the Government of India. Thegroup-wise Men-in-Position (MIP) as on 31st March 2017 stands as follows:
|Group || |
Strength of SC/ST/OBC
% of SC/ST/OBC
|SC ||ST ||OBC ||SC ||ST ||OBC |
|A ||3838 ||794 ||283 ||386* ||20.69 ||7.37 ||10.06* |
|B ||224 ||49 ||18 ||58 ||21.88 ||8.04 ||25.89 |
|C ||9725 ||1859 ||97 ||2754 ||19.12 ||1.00 ||28.32 |
|D ||1243 ||276 ||4 ||616 ||22.20 ||0.32 ||49.56 |
|Total ||15030 ||2978 ||402 ||3814 ||19.81 ||2.67 ||25.38 |
*strength of OBCs on rolls after reservation for OBCs came in to effect (08-09-1993).
However more than adequate strength of BCs were recruited prior to reservation for OBCscame in to effect.
for well being Navratna - Govt. of India Enterprise
Scholarship Scheme and Tuition Fee Concession
Your Company implements Educational Assistance Schemes to the wards of employees andContract Workmen for pursuing Under Graduate Degree/Diploma/Professional courses tillcourse duration subject to a maximum of five years. Exclusive Schemes have been devisedfor general merit SC/STs OBCs and Contract Workmen deployed by contractor employers andunder the Contract Workmen Scholarship Scheme 75 nos. of Scholarships have been earmarkedexclusively for girl children.
Besides above your Company reimburses the tuition fees for students belonging toSC/ST/OBC category studying in Jawahar Science College Neyveli every year.
Your Company creates a lot of opportunities to the children/students of Neyveli toparticipate in various competitions organised through the Education Department of theCompany in various events like Communal Harmony Neyveli Book Fair Children's DayVigilance Awareness Week etc.
Further 16 nos. of School toppers among the girl students of Neyveli Schools wereawarded with '10000 each as cash award with a Merit certificate and a medal.
Swachh Bharat Mission
As per the action plan drawn by your Company cleanliness drive programme were carriedout by the students of all Neyveli Schools at various locations from 16th April2016 to 30th April 2016 on the theme of Heritage Place andMonuments
As per the directives issued by the Govt. of India a detailed Swachh Bharat MissionAction Plan for the Fortnight from 01.11.2016 to 15.11.2016 and various activities such asMass Pledge special lecture programme on personal hygiene & prevention ofLeptospirosis Inter-school competitions visit to various villages to create awarenessamong the public street play mini marathon to create cleanliness awareness wereorganised during the fortnight.
Communal Harmony Campaign Week
As per the Ministry of Home Affairs GOI guidelines with a view to foster andreinforce the spirit of Communal Harmony National Integration and pride in vibrantcomposite culture and nationhood the QAUMI EKTA WEEK / COMMUNAL HARMONYCAMPAIGN WEEK - 2016 was observed from 19.11.2016 to 25.11.2016. Various activitieswere executed during that week.
Neyveli Complex established in the year 1959 has grown into a self-contained unit withall facilities. It has a total population about 135000 and spread over approximately 50Sq.kms. The facilities include Schools College sophisticated 340 bed General HospitalCentral Library Swimming Pools Auditorium Stadium Community Welfare CentresRecreation Clubs Reading Rooms Parks Banks Shopping complexes Offices of GovernmentAgencies and about 20410 quarters. The township is being maintained with total ecologicalbalance. Various sanitation and health hygiene plans are enforced and all national healthand immunisation programmes were organised for the eradication of congenital and epidemicdiseases. Similar townships with all facilities have been provided to the employees postedin Barsingsar and Tuticorin.
Sports Development Centre
Sports Development Centre has been promoting sports activities among the Neyveli Schoolstudents youth and NLCIL personnel. Neyveli School students are regularly trained invarious disciplines by the coaches in the Sports Development Centre and they have beensponsored to participate in many tournaments. Promotion of sports among the students hasculminated in the form of notable achievements at State National and even atInternational level and won various medals/trophies.
Environmental Management & Sustainable Development Projects
Your Company practices and promotes the best environment management plan and iscommitted to environment friendly mining and power generation. The environment policy ofyour Company is in line with the Vision and Mission Statement and 3 Thermal Power Stationsand 3 Mines at Neyveli have been certified with ISO 14001 (Environment Management System)ISO 9001 (Quality Management System) and OHSAS 18001 (Occupational Health and SafetyManagement System) certifications.
Members may be aware that your Company adopts various methods for reclaiming the minedout soil and one of those methods is Integrated Farming System (IFS) a technique jointlydeveloped with the Tamil Nadu Agricultural University and successfully implemented inreclaiming the mined out land suitable for agricultural horticulture crops anddevelopment of forestry pasture land fish & Prawn culture protection of waterbodies sericulture etc..
During the year 2016-17 113.50 Ha of land has been reclaimed in all the Mines ofNeyveli. Orchards and herbal cultivation is undertaken in the reclaimed area. Slopestabilisation of the Mines Overburden dumps has been undertaken with a view to convert themine spoil into vegetative making fit for habitation.
Your Company continues to plant trees in order to maintain the green belt and so farover 20 million trees have been planted in and around Neyveli Township and productionunits which helps in maintaining clean environment dust suppression noise controllowering the atmospheric temperature and maintaining the ecological balance.
As a part of bio-diversity initiatives have been taken up to promote integrated fishfarming in the Neyveli Township under CSR scheme. In Kundan Kulam Tank a natural waterresource spread over 9 acres 7 fish ponds with a depth of 3.6 m and water storagecapacity of 2000 to 3000 m2 have been formed at a cost of '50 lakh. Thedepartment of Marine Biology Annamalai University is the consultant for the project.
Collaborative study under sustainable development head has been taken up withPondicherry Engineering college on Sequestration of Co2 and production ofbio-fuel from flue gas of Thermal Power Plants is under progress.
A Project on Identification of suitable surface water bodies for de-silting andrestoration in the Neyveli Hydro-geological Basin using Geospatiatial Technology hasbeen taken up in association with Annamalai University Chidambaram at a total cost of'42.12 lakh.
Your Company gives paramount importance to safety of its men and equipment. RegularRisk Assessment and Safety Audits are conducted in Mines and Thermal Power Stationsthrough engaging accredited external agencies. Safety related trainings are imparted atall levels of employees through well-designed training centres like Group VocationalTraining Centre in Mines Thermal Training Centre and Learning & Development Centre.Pit Safety Committee Unit Safety Committee and Central Safety Council are functioningwith a view to cultivate safety awareness among the employees and to avoid/minimiseaccidents.
Your Company has developed a comprehensive Integrated Risk Management (IRM) frameworkheaded by Functional Director under this framework Risk Management is practiced in allthe units and the possible risks associated with its business are identified &mitigation plans are evolved. The risk together with the mitigation plans and itsimplementations are reviewed by the Risk Management Committee and by the Boardperiodically.
In order to sensitise the employees of your Company measures such as pro-activepreventive and punitive vigilance activities were undertaken by the Vigilance Department.Surprise checks regular checks CTE type examinations quality check and Study/Inspectionhave been conducted and various system improvements were achieved.
Various IT initiatives such as Integrated Complaint Management System; Public Interfacethro' Social Media Webpage WhatsApp Messenger; Bill Tracking System; Payment to ContractWorkmen by the Contractors through Bank; GPS based Vehicles Tracking System for lignitetransportation; Auto refund of EMD for unsuccessful bidders for Purchase of Materialsthrough e-procurement in OLIMMS; Online Vendor empanelment and Installation ofSurveillance Camera have been taken besides mapping of corruption.
As was done during the last year in order to impart ethical awareness and ethicalcharacter education programmes were conducted wherein more than 2500 school students ofNeyveli Township participated. Customized training programmes were also conducted tosensitize the employees.
MoU with Transparency International
Your Company has signed a Memorandum of Understanding with Transparency InternationalIndia part of Asia Pacific forum comprising 20 nations. Transparency International Indiais the Indian chapter of Transparency International based at Berlin Germany. During theyear 2016-17 two review meetings of the Independent External Monitors were held.
As part of Diamond Jubilee celebration your Company during the year under reviewconducted the following two day National Seminars at Neyveli wherein delegates from otherPublic Sector Enterprises and Government Organisations from all over India hadparticipated:
> Seminar on Best Human Resources Practices' in association with the NeyveliChapter of the National Institute of Personnel Management.
> Seminar on the theme Present scenario in Power Sector & futurechallenges.
> Seminar titled Eco - friendly surface mining technology challenges and wayforward.
> Seminar on Best practices in Tendering Contract Management and DisputeResolution in association with the Standing Committee of Public Sector Enterprise(SCOPE).
> Seminar on Best Practices in Financial Management.
Corporate Social Responsibility
Your Company as a socially responsible corporate citizen continues to carry outdevelopment works in the surrounding villages focusing on the socio economic developmentof the operating regions for achieving inclusive growth.
> In the Year 2016-17 your Company had adopted a revised Corporate SocialResponsibility Policy covering the various sectors of sustainable socio-economicdevelopment. The Policy is available in the Company's Website:https://www.nlcindia.com/new_website/index.htm
> Your Company outlays funds for the CSR projects programmes and activitiesselected for implementation under the CSR Policy.
> The CSR Committee of the Board is monitoring the implementation of the CSRProjects. The Board of Directors reviews the same in order to ensure that your Companyspends in every financial year at least 2% of the average net profits of the Company forthe last three years.
> Timeframes and milestones are fixed through Baseline Survey before commencement ofthe CSR Projects.
> Initiatives of State/ Central Government Departments/ Agencies are dovetailed/synergized with the CSR Activities of NLCIL.
The CSR projects taken up by your Company for the year 2016-17 amounts to '43.46 crore.
The manner in which the amount was spent is given in the Annexure-1.
The major CSR initiatives undertaken during the year 2016-17 are given below:- CSR -Peripheral
Members may be aware that a structured system is in operation for executing capitalworks for developing social infrastructure and building Sustainable Community Assets whichbenefit the villages surrounding Neyveli in Tamil Nadu and Barsingsar in Rajasthan. Underthis scheme infrastructure development works like drinking water facility by sinking/maintaining the bore-wells constructing RCC water tanks providing roads bridges &access additional school buildings
laboratories libraries additional Infrastructure for primary health centresdeveloping medical facilities de-silting of lakes etc. are being carried out on thebasis of needs and priorities. Various works have been carried out during the year underreview for the benefit of the population in the areas surrounding the operatinglocalities.
During the year 2016-17 Your Company has taken up the following activities:
Water resource Augmentation (Jala Paryaptha)
Desilting and other improvement works in Sengal Odai and Middle Paravanar towards waterresource augmentation was taken up in 2016-17 for the benefit of around 60 peripheralvillages of Neyveli at a cost of around tl.Q crore. This work is being continued in2017-18 at a cost of ?5.78 crore.
Drinking Water (Jal-Dhara)
Drinking water and butter milk were provided to the public for 47 days during the peaksummer catering to around 8000 persons per day.
To cater to the need of drinking water to the public 10 Nos. of purified drinkingwater plants have been installed (5 Nos. provided in Heritage sites viz. ThirumalaTirupathi Devasthanam Lord Jagannath Temple at Puri and Sri Natarajar TempleChidambaram. 5 Nos. were provided in Neyveli including 3 Nos. in Resettlement areas).
Water Harvest Scheme (Jal-Uday)
Your Company has taken up water harvest schemes to improve water bodies at Neyvelicomplex including Kundan Tank and Villudaiyanpattu Tank. Original habitat formation hasbeen brought back by fish breeding and aquaculture. Further planting of flowering treesfruit trees organic farming herbal and medicinal plants are also taken up.
Roads and Access (Dhora)
Laying of BT Road formation from Pudhukooraipettai village to Ulundurpet Highway hasbeen taken up in 2016-17 at a cost of ?1.77 crore. This work has been carried outpartially and being continued for completion in 2017-18. Apart from the above saidproject your Company provides roads and access to general public in the peripheralvillages of Neyveli and Barsingsar. Your Company also provides access to the socialfacilities of the Company's Townships to the public in the surrounding areas.
Your Company has also provided LED Lamps in local areas for energy conservation.
CSR - Community
Your Company continues to extend all assistance including grant and infrastructure toSneha Opportunity Services at Neyveli to run a day care education and training centre forspecial children of the region. Sneha school imparts education and training to mentallychallenged children (around 75 children 49 Boys & 26 Girls).
Neyveli Health Promotion and Social Welfare Society patronised by your Company has beenserving the society running a school for the hearing impaired and a Computer Centre forimparting training for physically challenged widows & destitute and gainfullyemploying them through various training.
During the year 2016-17 CSR focused Training programmes were organised for the benefitof the students teachers and the population of Neyveli locality in which 745 personsparticipated. 370 women from various peripheral villages were trained for Light MotorVehicle Driving Tailoring Gem and Jewellery and Beautician Trades. 375 men from variousperipheral villages were trained in trades of Operation & Maintenance of Light MotorVehicles Heavy Transport Vehicles and Earth Moving Equipment Operation.
During the year 2016-17 Your Company has provided
Battery Operated Vehicles & DG Sets to Heritage sites
Yoga Kendras for promoting Yoga as per Govt. Directives
Your Company has taken action for establishing old age home at Neyveli for thebenefit of old-aged.
Gas Crematorium at Neyveli
During the year 2016-17 Your Company has also undertaken relief measures in the areaaffected by Cyclone Vardha in and around Chennai Tamil Nadu and extended its helping handby distributing the relief materials and clearing more than 1000 trees which had fallen.
CSR - Education (Taaleem)
Your Company offers best education through its 10 schools - 3 Higher Secondary Schools2 High Schools 3 Middle Schools and 2 Elementary Schools and also through the KendriyaVidyalaya at Neyveli to the students from surrounding villages and also to the wards ofemployees. The total students' strength in these 11 schools was 6017. Your Company hasimparted coaching classes to the deprived and under privileged students from theperipheral village schools entering X standard in the year 2016-17.
Your Company provides infrastructural support and also periodical financial support tovarious educational institutions in Barsingsar for providing quality education andtechnical training to the children of villages around your Company's project-sites atNeyveli.
CSR - Health (Ilaaj)
Your Company provides quality medical treatment and occupational health servicesthrough its General Hospital to all inhabitants of the Neyveli Township and itssurrounding villages including comprehensive medical treatment to the Contract Workmenand their family members.
During the year 2016-17
Free medical consultation with minimum antibiotic therapy and vitamins wereextended in about 533616 instances to out-patients from the rural public and ContractWorkmen. About 29523 patients were given emergency treatment for various causes.
In-patient care treatment including Intensive Care for critical conditions allsurgeries (General ENT Ortho Obstetrics & Gynaecology Dermatology) was given atfree of cost for about 13430 patients from the rural public and Contract Workmen.
18 medical camps were conducted in peripheral villages located in the areasurrounding Neyveli Township in Cuddalore District. 6669 persons of these villages werescreened and given medical advice & medicines. While 642 Random Blood Sugar Tests weretaken 289 Electro Cardio Grams were generated and 438 persons were provided with visionglasses. 2503 patients were referred for in-patient treatment of which 656 personsunderwent the same.
Five Blood Donation Camps were conducted by your Company wherein 349 Students ofCuddalore ITI Aries Polytechnic - Karunkuzhi Periyar Arts College - Cuddalore AnnaUniversity - Panruti R.K. ITI - Cuddalore participated for the stock of GovernmentHospital at Cuddalore.
From February 2013 onwards your Company is providing nutritious food supplementto the HIV affected children belonging to the Cuddalore District HIV Positive SocietyCuddalore. 300 such children were provided with food supplements during the year 2016-17.
Swachh Bharath Pakhwadas were planned and carried out various programmes towardsSwachh Bharath Mission as per Government directives.
In addition to the above the details on specific Corporate Social Responsibilityprojects undertaken in compliance with Section 135 of the Companies Act 2013 are placedas Annexure-1.
FORUM OF WOMEN IN PUBLIC SECTOR (WIPS)
WIPS NLC Chapter conducts regular inter-organisational and intra-organisationalmeetings to elicit the views of its members & other members of the society andaccordingly the following themes were given importance during year 2016 - 17:
(a) Empowerment of women employees (Education Health & Encouragement).
(b) Motivational programme for girl children.
(c) Social welfare /awareness programme.
Visit of Parliamentary Committees
During the year 2016-17 the following Parliamentary Committees visited your Company:
Department related Parliamentary Standing Committee on Personnel PublicGrievances Law and Justice Department related Parliamentary Standing Committee on HumanResource Development.
Parliamentary Committee on papers laid on the table Rajya Sabha.
Parliamentary Committee on Subordinate Legislation Rajya Sabha on the subjectHazardous and other Wastes (Management and Trans-boundary Movement) Rules 2016 andPlastic Waste Management Rules 2016.
Parliamentary Standing Committee on Coal and Steel on the subject Briefingon Compliance of Environmental Norms by Coal/Lignite Companies.
Departmental Parliamentary Committee on Industry on 19th December2016 at Mumbai on the subject Prescribed 20% procurement from MSMEs by the PSEs andthe status of Vendor Development Programme.
Parliamentary Standing Committee on Coal and Steel on the subjectProduction of Lignite-Projections and Planning.
Awards & Recognition
In recognition of its various activities your Company has been conferred with thefollowing awards during the year 2016-17: Gold Trophy & a Citation of Scope ExcellenceAward - Institutional Category (Maharatna/Navratna PSE's) for the year 2011-12.
National award for outstanding Industrial Relations for the year 2014-15 instituted bythe All India Organisation of Employers (AIOE).
Golden Peacock Environment Award 2016 instituted by Institute of Directors New Delhiin appreciation of its adoption of environment friendly technologies.
The following three awards instituted by Public Relation Society of India :
1. Best PSU implementing CSR (2nd Place)
2. Best Corporate film - Hindi (2nd Place)
3. Special Award for Best PSU implementing RTI
I Prize in RAJBHASHA FIELD for the best performance of the Official LanguageImplementation among the Member Offices of Town Official Language Implementation Committee(TOLIC)/Puducherry for the year 2015-16.
The Best Enterprise Award (Third prize) in the Navratna Category for theyear 2016 in recognition of its works for the development of women employees in theorganisation and the welfare of women and children in villages around Neyveli. FlyAsh Utilisation Award from Mission Energy Foundation for effective utilisation of Flyash.
Compliance under Persons with Disabilities Act 1995
Your Company ensures compliance of provisions under the Persons with Disabilities Act1995 and has evolved a comprehensive policy for Persons with Disabilities (PwDs) as perthe guidelines of Department of Personnel & Training (DoPT) for providing certainfacilities/amenities to PwDs to meet their requirements and to enable them to effectivelydischarge their duties.
Your Company had also resorted to a special recruitment drive during the year 2015 andfilled 130 vacancies with the persons with disabilities as per the reservation policy.
Compliance under the Right to Information Act 2005
Your Company ensures compliance under the Right to Information Act 2005. 19 CentralAssistant Public Information Officers representing different functional areas one NodalOfficer one Central Public Information Officer one Appellate Authority and oneTransparency Officer have been nominated to attend to the queries and appeals receivedunder the RTI act in a time bound manner.
During the year 2016-17 under the above Act 331 applications containing 2093 querieswere received and 296 applications covering 1926 queries have been replied.
Compliance under Public Procurement Policy
The Ministry of Micro Small and Medium Enterprises (MSME) has notified the PublicProcurement Policy and in terms of the notification issued has set an annual target of20% for procurement from MSME for the three years beginning from the financial year2012-13. After a period of three years i.e. from 1st April 2015 overallprocurement goal of minimum of 20% is made mandatory. The target set for the financialyear 2016-17 for procurement of such items which are within the scope of MSMEs was 20% andas against the same the achievement was 44.49%.
Your Company maintains Citizen's Charter indicating details of clients customersunder different heads system of redressal of grievance etc. and the same is regularlyupdated.
Conservation of Energy Technology absorption and Foreign Exchange Earnings and Outgo
The particulars required under Section 134(3)(m) of the Companies act 2013 regardingconservation of energy technology absorption and Foreign Exchange earnings and outgo arefurnished in Annexure-2.
Management Discussion & Analysis Report and Report on Corporate Governance TheManagement Discussion & Analysis Report is furnished in Annexure-3. The report onCorporate Governance on the compliance of Corporate Governance conditions stipulated bySEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and the DPEguidelines on Corporate Governance is furnished in Annexure-4. The Auditor's certificateon the compliance of the above Corporate Governance conditions is furnished in Annexure-5.
Statutory Disclosures under Companies Act 2013 and SEBI (LODR) Regulations 2015
Extract of Annual Return
The extract of Annual Return in terms of Section 134(3) read with 92(3) of theCompanies Act2013 is placed in Annexure-6.
Declaration by Independent Directors
The Independent Directors have given a declaration on meeting the criteria ofindependence as stipulated in Section 149(6) of the Companies Act 2013.
Particulars of Employees
Particulars of Employees as required under Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014-Nil.
Loans Guarantees and Investments
During the year 2016-17 your Company had subscribed to the equity share capital for anamount of '200.93 crore and '271.32 crore in NTPL & NUPPL respectively. As on 31stMarch 2017 the share capital held by your Company in NTPL & NUPPL is '1947.36 croreand '461.24 crore respectively. Your Company as the major Promoter has been extendingloans to its Subsidiaries viz. NTPL and NUPPL. During the year 2016-17 an aggregateamount of '520 crore was extended to NTPL and '60 crore to NUPPL to meet its fundingrequirements.
Your Company has not granted any other loan or guarantee or made any other investments(other than short term deposits with the bank in the ordinary course of business) duringthe year 2016-17.
Transfer to Capital Redemption Reserve
During the year 2016-17 an amount of '149.14 crore was transferred to capitalredemption reserves in compliance with the provisions of Companies Act 2013 consequentto the Buy-back of Equity Shares of the Company.
The Company has not accepted any deposit from public.
Disclosures with respect to demat suspense account/unclaimed suspense account in termsof SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015
There were 1100 equity shares pertaining to 6 shareholders lying unclaimed as on01.04.2016. During the year 2016-17 no claim was received from any of the aboveshareholders.
Material Changes affecting financial position occurring between the end date offinancial year and the date of the report
The Company has received CERC orders related to Barsingsar Thermal Power Station videorder dated 25th April 2017 having financial impact of '179.30 crore and orderdated 3rd May 2017 having financial impact of '52.81 crore. The impact of boththe orders has been considered while finalising the 2016-17 financial statements.
Sexual harassment of women at work place
A separate Committee has been constituted for looking into the complaints relating tosexual harassment of women at workplace. During the year 2016-17 one complaint wasreceived in this regard and the enquiry is under progress.
P.B.Vijayaraghavan & Co. Chartered Accountants Chennai and Chandran & RamanChartered Accountants Chennai were appointed by the Comptroller and Auditor General ofIndia (C&AG) as Joint Statutory Auditors for the year 2016-17 under Section 139 of theCompanies Act 2013. The Board of Directors of your Company has fixed '24 lakh plusapplicable service tax as the Statutory Audit fees to be shared equally by the JointStatutory Auditors.
Bhandawat and Company Chartered Accountants Jaipur has been appointed as the BranchAuditor for the year 2016-17 by C&AG for conducting the audit of Mine and ThermalUnits at Barsingsar.
Shri.R.Balasubramaniam Practicing Company Secretary Chennai was appointed as theSecretarial Audit for the year 2016-17.The Secretarial Audit report for the year 2016-17and the reply to observations of the Secretarial Auditor are furnished in Annexure-7.
Bandyopadhyaya Bhaumik & Co Kolkata was appointed as the Cost Auditor for the year2016-17 to conduct cost audit for Mines & Power Stations of the Company. The costaudit report for the year 2015-16 was filed with MCA on 28th September 2016against the due date of 11th October 2016.
C&AG's Comments on the accounts for the year ended 31st March 2017 isfurnished in Annexure-8.
Directors' Responsibility Statement as per Section 134(3)(c) of the Companies Act 2013
The Board of Directors declares that:
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
(c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors had prepared the annual accounts on a going concern basis;
(e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively and
(f) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Board of Directors
Shri. Vivek Bharadwaj Joint Secretary Ministry of Coal Dr. Rajeev Ranjan the thenAdditional Chief Secretary to Govt. of Tamil Nadu Energy Department Shri. R.P. GuptaJoint Secretary Ministry of Coal Shri. R. Vikraman Director (Human Resource) Ms.Nalini Padmanabhan Ms. Monika Arora Independent Directors Shri. Vikram Kapur PrincipalSecretary to Government of Tamil Nadu Energy Department and Shri. Suresh KumarAdditional Secretary to Government of India Ministry of Coal were inducted into the Boardof Directors w.e.f. 05.08.2016 16.08.2016 30.08.2016 09.12.2016 02.02.201702.03.2017 29.03.2017 and 09.06.2017 respectively. Shri Vivek Bharadwaj Dr. RajeevRanjan and Shri R.P. Gupta relinquished their position as Directors w.e.f. 30.08.201606.03.2017 and 09.06.2017 respectively. The Board places on record its appreciation forthe valuable contribution made by them during their tenure as Directors on the Board ofthe Company.
Shri. Subir Das Director retires by rotation at the forthcoming Annual General Meetingand being eligible offers himself for re-election.
The Board of Directors of your Company places on record its sincere appreciation forthe continued support and guidance extended by the Ministry of Coal Ministry of PowerMinistry of New and Renewable Energy Ministry of Finance Ministry of Environment &Forest Ministry of Industry Ministry of Labour Ministry of Heavy Industries NITIAayog Central Electricity Authority Central Electricity Regulatory Commission StateElectricity Boards and beneficiaries of Tamil Nadu Andhra Pradesh Telangana KarnatakaKerala Puducherry and Rajasthan and also the Joint Venture Partners viz. Tamil NaduGeneration and Distribution Corporation Limited (TANGEDCO) Uttar Pradesh Rajya VidyutUtpadan Nigam Limited (UPRVUNL) Mahanadi Coalfields Limited (MCL) and Hindalco.
The Board of Directors of your Company is pleased to acknowledge with gratitude theco-operation and continued support extended by the Governments of Tamil Nadu RajasthanUttar Pradesh Jharkhand and Odisha V.O.C. Port Trust Tuticorin and the DistrictAdministrations of Cuddalore Bikaner Tuticorin Sambalpur Kanpur Nagar and Dumka. Thesupport and co-operation extended by the Comptroller and Auditor General of India theStatutory Auditors Branch Auditor Cost Auditor Secretarial Auditor Director General ofMines Safety the Factory & Boiler Inspectorates Chief Inspector of Factories theDirector of Boilers Central Pollution Control Board State Pollution Control Board ChiefController of Explosives Regional Labour Commissioner Regional Provident FundCommissioner the Company's Bankers and KfW of Germany need special mention and theDirectors acknowledge the same.
Your Directors also wish to place on record their appreciation for the dedicated workput forth by the Employees at all levels. The positive role played by the recognised TradeUnions and Associations of the Engineers and Officers in maintaining cordial industrialrelations deserves special mention.
| ||for and on behalf of the Board of Directors |
|Place : Chennai ||Dr.SARAT KUMAR ACHARYA |
|Date : 12-8-2017 ||CHAIRMAN AND MANAGING DIRECTOR |