London-listed Essar Energy plc today said it had been allocated coal from the Amelia coal block in Madhya Pradesh for fuel supplies to the firm's 1,200 MW Mahan-I power project.

The allocation of a share of coal from Amelia block by the Madhya Pradesh government gives Essar Energy a second source of fuel to supply for Mahan I project, the company said in a statement. The project already has supplies from its Mahan coal block.

Also Read   Related Stories News Now - GoM on coal may take up issue of block allocation to Adani - CoalMin seeks status report on captive blocks from firms - Essar Energy eyeing oil, gas assets overseas - Neyveli Lignite plans 4,000 MW plant in Tamil Nadu - Coal Min to play fair in NTPC-NLC tussle for coal blocks - Essar improving operating efficiency at Stanlow refinery

Also Read   Related Stories News Now - Markets end flat - Turbulence ahead for airlines despite oil price drop - Weak rupee may bring cheer to NRIs, expats - LIC buys PSU stocks, sells pvt sector blue-chips in Q4 - Banks may lower deposit rates as inflation eases: Report More

"The addition of Amelia will significantly extend coal availability from Essar's captive blocks for Mahan I from the current estimate of approximately 12 years. Both blocks are within very close proximity to the power project," it said.

The state government has formally notified that Essar Energy and another company, DB Mining Power, will jointly be allocated 40 per cent of the coal from Amelia. The block is being operated by Madhya Pradesh State Mining Corp (MPSMC).

Amelia is estimated to have around 214 million tonnes of coal reserves, according to the Ministry of Coal. The block still requires environmental and other approvals before mining operations can begin.

"Essar Energy will be supplied with its entitlement of coal from Amelia by MPSMC under a long term linkage arrangement once a Fuel Supply Agreement has been signed," the statement said.

It added, "The FSA is expected to be signed once the required environmental and other approvals have been obtained. The coal will be supplied at prevailing Indian coal linkage prices."

The company said it still expects to secure a separate shorter term tapering coal linkage arrangement to secure fuel for Mahan I until the Mahan block produced sufficient coal.

The Mahan block will supply fuel to Mahan I, which is due to be completed by March, 2012.

New Ipad Application :Business Standard's all new IPad App Click here to download for free Other Stories      - Markets end flat - Turbulence ahead for airlines despite oil price drop - Weak rupee may bring cheer to NRIs, expats - LIC buys PSU stocks, sells pvt sector blue-chips in Q4 - Banks may lower deposit rates as inflation eases: Report

Tags : Essar Energy | coal block | Amelia coal block   Read Business news in  Advertisements -  Journey on, We are by Your Side. Click here to know more -  2 Lac Apartments, 1 Lac House / Plots. Click here -  Benefits Upto Rs. 2.36 Lakhs on the Fully Loaded TJet Petrol. -  The Best Seller is Also the No. 1 in Mileage. Click here -  Watch The Film Here. Click here to know more.. -  Leader in Passenger Car & Automobile Tyres. Click here -  1 billion in saving for Unilever without any tangles. -  A Brand New Server at a Price That Fits Your Budget. Click here -  Learn How One City is Running on FOOD SCRAPS. -  One Partnership Endless Possibilities. Click here to know more -  Helping doctors detect diseases earlier, saving costs & extending lives. -  36 Lakhs can get you a pool of Luxuries. Click here -  Which is the best plan for your daughter -  Check out the TRUE COLOURS of your Stocks, Now for FREE! -  One of the leading business schools in the world.Know More