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Steel Authority bags Sitanala coal block

BS Reporter  |  Kolkata 

Steel Authority of India Ltd (SAIL) has been allotted the Sitanala coking coal block in Jharkhand, which will result in significant cost savings on raw materials.
In an intimation to the stock exchanges, SAIL has stated that as per the communication from the Union ministry of coal, the central government had decided to allot the Sitanala coking coal block in Bharat Coking Coal Ltd (BCCL) command area. Industry sources said Sitanala has reserves of around 108 million tonne.
SAIL's total coal requirement is around 15 million tonne, of which around 10 million tonne is imported. SAIL evinced interest in the Sitanala block in October 2005.
In 2005-06, the steel PSU incurred a cost of Rs 8,022 crore on account of coal usage. While the company is covered for its iron ore requirements, the situation is not the same with coal.
SAIL has three collieries, Chasnala with reserves of 40 million tonne, Jitpur with 16 million tonne and Ramnagar at 150 million tonne.
Sources said SAIL had also indicated interest in the Kapuria block in Orissa. The block has reserves of around 40 million tonne.
SAIL's requirement of coal will only go up. According to the corporate plan 2011-12, the company would endeavour to achieve 22 million tonne capacity and the coal requirement for enhanced capacity would be in the region of 22-23 million tonne as against 15 million tonne at present.
SAIL was also in dialogue with Coal India subsidiary, BCCL for floating a special purpose vehicle, for joint mines development.

First Published: Sun, April 15 2007. 00:00 IST