Coal secretary Anil Swarup on Thursday said the government was considering giving mines to private players for commercial mining but the demand situation was holding it back from taking a final call.
“The minister is eager to give blocks to private players for commercial mining but we cannot do it unless we are assured that everyone is getting coal,” Swarup said, adding that the state governments have already been allocated blocks for commercial mining. He said there has been a paradigm shift in the problem— from a phase of supply shortage to a phase of demand shortage — and this demand shortage was due to low generation of the generation companies at PLF not more than 59-60%. The generation companies were generating low because of low demand from distribution companies. However, the UDAY scheme, which has been floated to restructure the distribution companies, could be the only saviour to this situation, Swarup said.
He made it clear that Coal India (CIL) has started cutting down on production, though it was still sticking to its target of producing 1 billion tonne by 2022. “We may not extract more than our requirement but we should get prepared to produce as much as our target and lift when required,” Swarup said.
In fact, with 56 mt of record inventory last financial year, the situation of oversupply arose and in the present production situation, India might again fall short of coal if PLF of power producing plants increased by 6-7%, Swarup said. CIL has adopted the strategy of ready to mine on shelf, which means the seams would be prepared for extraction but the coal, instead of getting extracted, would remain in the seam shelves.
In a demand shortage situation, the inventory benchmark for the power plants have come down to 15 days from 22 days.This has happened because coal was readily available. To improve upon the demand situation, PSU power plants would reduce imports to the extend 15 mt by the end of 2016-17 and by FY18-end, there would be zero imports by the state and central power PSUs, Swarup said.
The state and the central power PSUs together imports between 35-40 mt per annum. “For the regulated sector like steel, we are working with them to supply their coal requirement instead of allowing them to continue imports,” Swarup said.