CIL chief raps NTPC on coal quality demand

Narasing Rao says the company is ready for a third party inspection of coal but at loading point

Ruling out the possibility of giving in to NTPC’s demand for billing coal at the receiving point under the new fuel supply agreements (FSAs), Coal India Limited (CIL) Chairman Narsing Rao on Monday said the company was ready for a third-party inspection of coal but at the loading point.

“Everywhere in the world, quality analysis happens at the loading point. How can one ask CIL to ensure quality at the unloading point, when carrying it is not its responsibility? There is a joint sampling mechanism now; we are ready for third-party inspection at the loading point,” he said.

Recently, CIL subsidiary Eastern Coalfields had stopped supply to NTPC’s plants at Kahalgaon and Farakka for three days ( since April 1), after the power company held back payment of about Rs 1,000 crore, alleging “stones” were supplied in the name of coal.

“Stone does not produce power. I do not understand why they are suddenly raising the issue. We are supplying coal from the same Rajmahal mine. There is no denying this fact. Also, I don’t understand why they stopped participating in the joint sampling analysis since last October,” Rao told reporters.

“Now, joint sampling has resumed and it shows there can be no question over quality. After their participation in joint sampling, we resumed supply. But on the same issue, they are not ready to sign the FSA. I really wonder what the reason is,” he added.

In December 2012, the government had asked power producers to sign FSAs with CIL within a month. The cumulative generation of NTPC plants that had come on stream since March 2009 but for which FSAs were yet to be signed was about 8,500 Mw.

“NTPC’s total dues stand at about Rs 2,000 crore. But to be fair, the main problem is with Eastern Coalfields,” Rao said.

In 2012-13, CIL’s supply to power utilities rose 10.2 per cent to 343.79 million tonnes (mt), while growth in overall offtake stood at 7.4 per cent (465.19 mt). NTPC’s power plants saw good growth in coal supply from CIL.

Supplies to NTPC’s thermal power plants in 2012-13 stood at 132.84 mt, compared with 115.84 mt in 2011-12, a rise of 14.7 per cent.

Allaying power companies’ concerns on coal shortage, Rao said, “Let me assure whoever has a power purchase agreement with discoms shall have no reason to be laid down by us.”