Coal ministry rejects Nalco's claim of fuel supply shortage

Rejecting Nalco's claim that three units of the PSU's captive power plants were shut due to fuel shortage, the coal ministry on Monday said there is ample dispatch of coal to the PSU which has a regular supply of 4.7 MTPA dry fuel, more than the committed quantity by Coal India.

"It is stated that contrary to the recent media news, attributing the closure of three units of Nalco's captive power plant due to a shortage of coal leading to curtailment of aluminium production, the ground reality is totally different," the Coal Ministry said in a statement.

The supply of fuel to the National Aluminium Company Ltd is mainly from Bharatpur opencast mines of Talcher coalfield of MCL (Mahanadi Coalfields Ltd) -- a Coal India arm, the ministry said, adding that in case of shortage of supply of coal from this mine the balance quantity of fossil fuel is supplied from other opencast mines of Talcher Coalfields.

Nalco has a regular coal linkage for supply of 4.716 million tonnes per annum (MTPA) coal from MCL, the ministry said.

Although the commitment of MCL is to supply a minimum of 75 per cent of the linkage quantity, the aluminium major has been supplied 96 per cent of pro rata linkage quantity, the ministry added.

"Although the supplies against bridge linkage are on a best effort basis i.e. subject to availability of coal, NALCO has been supplied 130 per cent of the pro rata bridge linkage quantity so far," the ministry said.

The Talcher Coalfield in general and in particular some of the mines like Bharatpur, Hingula, Kaniha are facing land constraint and law and order problems in the form of frequent work stoppage by few local people who are not employees of Mahanadi Coalfields Ltd.

"It has been reported by MCL that due to these constraints, in this year MCL could produce 37.23 MT coal (so far in the current fiscal) in Talcher Coalfield against the target of 55.49 MT which is not only 18.26 MT below target but is also a negative growth of 7.8 per cent as compared to the coal production from Talcher coalfields in the same time period during last year," the ministry said.

These law and order issues have been frequently highlighted at different levels with the Odisha government by the senior officials of Coal India and Coal Ministry. Coal Minister Piyush Goyal also raised the matter in his letter dated September 1 addressed to the Chief Minister of Odisha.

Despite the fact that there have been several law and order problems hampering the targeted coal production of MCL, the coal supplies to the different power plants in Odisha have been maintained.

The four power plants in the state, which account for nearly 4910 MW capacity, have not only been supplied coal more than the minimum committed quantity but are also having coal stock sufficient for 7-12 days consumption, the ministry said.

Last week, navratna CPSE Nalco had said faced with coal shortage it had to close down its three units of its captive power plant.