CIL to restrict e-auction volume to 7% of production

E-auction sales would be gradually stabilised at 49 mt over the next four-five years: S Narsing Rao

State-owned Coal India Ltd (CIL) plans to restrict spot sales to 49 million tonnes (mt), about seven per cent of its production, over the next four to five years.

“E-auction sales would be gradually stabilised at 49 mt over the next four-five years,” said Chairman S Narsing Rao.

Earlier this year, the government had asked the company to bring down spot sales and sell more to power companies under fuel supply agreements (FSA). This would, however, impact its financial health unless production goes up or the government allows a rise in notified prices.

Prices getting realised at e-auction are typically 70-80 per cent higher than the notified price of coal. The company produced 432 mt in FY12.

 

About 11 per cent of this was sold through e-auction. Between April and September this year, CIL’s production jumped nine per cent to 208 mt.

Rao said the company’s board had decided to ask International Coal Ventures Ltd (ICVL), the government's special purpose vehicle to scout for coal assets abroad, to explain why CIL should not opt out of the venture.

The board has already taken a decision to move out of ICVL.