CoalMin sets another deadline; asks CIL to sign FSAs by Sept 6

State-owned Coal India has been asked to sign FSAs with power plants by September 6, after the earlier deadline set by the Coal Ministry for signing of fuel supply pacts for a capacity of 78,000 MW expired on August 30.

The direction to CIL for signing of the pacts was given by the Coal Ministry in a meeting held recently.

"Coal India has been asked to sign fuel supply agreements (FSAs) for 78,000 MW capacity by September 6," a source said.

CIL has to sign 173 FSAs with power companies for a total capacity of 78,000 MW, as directed by the Coal Ministry.

The CIL board had on August 3 approved signing of FSAs for a capacity of 78,000 MW instead of 60,678 MW earlier, the source added.

A capacity of 60,678 MW was the projected requirement for 131 power plants commissioned, or to be commissioned by March, 2015.

CIL has so far signed around 130 FSAs, including with NTPC, which had earlier raised quality issues of the dry-fuel supplied to it and had stopped payments to Eastern Coalfields Ltd, a CIL subsidiary.

Following government's intervention, CIL modified its fuel supply agreement to allow a third party to collect samples and determine the quality of the dry fuel.

The modified provision will be effective after third-party sampling starts, CIL had said.

It replaces a system of sampling and analysis that was to be conducted jointly by the buyer and the seller of coal.