Country?s largest power producer NTPC will soon float tender to start direct import of coal to meet fuel shortfalls for its power plants. As of now, the central utility imports coal through canalising agencies like State Trading Corporation and MMTC. The company recently decided to directly import coal and prevent in delays in fuel supply under the canalising route. NTPC is likely to import 16-18 million tonnes coal in the coming financial year as against 14 million tones target for the 2010-11. The tender will be floated in phases depending on the actual need by its power stations.
?We plan to issue tender soon for importing 4 million tonnes coal on our own. Similar tenders will be floated in due course to meet the requirements of our power plants,? a company official said.
Following a directive from the power ministry, the company is using blended coal at its various stations to mitigate domestic fuel shortfalls. This has increased the quantum of imported coal needed by the company. Anticipating its huge demand for imported coal in coming years, India’s largest thermal power generator apparently wants to develop in-house expertise in the business, which would in turn help the company reduce its cost over the long run.
The power ministry has set a 14 million tonne-coal import target for NTPC in the current financial year. Against that, it had imported 9 million tonne coal as at the end of December through canalising agencies.
?The target is projected to go up to 16-18 million tonnes in the coming financial year as additional generation capacity comes on-stream,? the official said.
NTPC’s coal import requirement is projected to further rise fast over next 6-7 years as the company has targeted to have 75,000 mw generation capacity by March 2017, as against 33,000 mw now.
?To obtain a competitive coal price, one needs to be familiar with the international market. Besides, control over transportation cost would also help in reducing the landed cost for an importer given that freight charges account for a significant chunk of landed cost,? says Dilipkumar Jena, knowledge manager, PWC.
For example, freight charges for importing coal from Australia are around $40 a tonne while the current market price of coal is $120-130 a tonne. Similarly, charges for shipping coal from South Africa and Indonesia are currently in the range of $30 and $20 a tonne, respectively.
