VAL seeks long-term coal linkage from Orissa

Vedanta Aluminium Ltd (VAL), a unit of Anil Agarwal-led Vedanta Resources Plc, has sought the intervention of the Orissa government for securing long-term coal linkage for its captive power plant (CPP) at Jharsuguda.

The aluminium major required the coal linkage for its unit-6 and unit-9 of 135 Mw each capacity to feed power to the 0.5 million tonne per annum aluminum smelter in Jharsuguda.

"We request for your kind intervention and to take up the matter with the ministry of coal for re-allocation of coal linkage to our two units of 135 Mw each,” requested Pramod Suri, chief executive officer and whole-time director, VAL, in a letter to the state chief secretary B K Pattnaik.

The Mahanadi Coalfields Limited (MCL), a subsidiary of Coal India, had denied signing the fuel supply assurance (FSA) for these two units due to non-availability of consent to operate from the state pollution control board, read the letter.

MCL had cancelled the letter of assurance (LoA) for the two units and encashed the bank guarantee (BG) and cited the reason of non-fulfillment of LoA milestones. But, the aluminum major has a different tale to tell.

"We have achieved all the milestones under the LoA and the amended milestone policy set by the Coal India limited", said VAL.

The letter further stated that MCL had refused the company's approach for reinstatement of LoA and refund the encashed BG amount. It advised the company to approach the Ministry of coal for signing the FSA, for which the company has already extended the bank guarantee. The two units of 135 Mw each, with an investment of 800 crores, are lying idle without coal.