?We are looking at time-bound exploration?

Singareni Collieries Company Ltd (SCCL), jointly owned by Andhra Pradesh and government of India in a 51:49 ratio, is speeding up exploration to complete the task ahead of time. The company has also set e-procurement as a priority area. Sutirtha Bhattacharya, chairman & managing director of SCCL, tells FE?s BV Mahalakshmi that the company would raise production by about two million tonnes this year, and is looking to expand exploration beyond Andhra Pradesh. Excerpts:

Why do you think that e-procurement is the way forward for a transparent bidding process?

E-procurement is a priority at SCCL for quicker and transparent bidding. This would also set an example for national and international companies for coal reviews. Hence, we are looking at newer technology platforms to implement the processes. We are in talks with service providers, including National Informatics Centre (NIC), and coordinating with Coal India to make the processes quicker than the conventional methods. This would also improve the e-auctioning processes from the present 25% level to 90% by this year. In all, we want to consolidate, ensure timely completion of the power project and speed up exploration activities to achieve the planned target set by the Planning Commission through eco-compliant ways.

Given the current coal availability, what are the 12th Plan target, production target for 2012-13 and the planned capex?

We plan to raise coal production by about two million tonnes during 2012-13 to 53.10 million tonnes by opening new mines and improving productivity. The 12th Plan target is to reach a production of 57 million tonnes by 2016-17. We want to improve the overall productivity at our mines. As part of this strategy, we are looking at time-bound exploration. In fact, we have set a target to complete the exploration activities that are fixed for 2016 as early as by 2014. This is a workable proposition and we will be facilitating this with increased expenditure towards human resources and technology.

What is the issue regarding diversion of forest land for coal mining and the related compensatory afforestation measures?

We have written to the ministry of environment and forests, citing that we are facing problems in identifying the equal extent of non-forest land for compensatory afforestation, to submit diversion proposals of forest land for coal projects. We have requested the ministry to treat SCCL on a par with Coal India Ltd for the purpose of land for compensatory afforestation. This would help as we do have plans to expand our mining outside Andhra Pradesh with the consent of the ministry of coal.

Further, our linkages are not confined to AP as we supply coal to NTPC, Maha Genco and KPCL, among others. It is becoming increasingly difficult to achieve targets by opening new mines because of the time involved in getting diversion of forest land. Hence, we have requested to treat us on a par with a CPSU like CIL.

In fact, the State Wildlife Board has decided to recommend diversion of 231.84 hectares of forest land in the Chatakonda reserve forest in Kothagudem for a coal mining project of us. The area in the Khammam district is proposed for the Koyagudem Open Cast-II (Phase-II) mining project. Coal mining activity is site-specific where coal is available, and the proposed open-cast project is located at minimum and maximum distances of 4.16 km and 5.50 km, respectively, from the boundary of the Kinnerasani wildlife sanctuary. We are also in talks with EPTRI for preparing an environment management plan.

What is the current sales realisation?

We have 15 opencast and 11 underground mines. The sales realisation was about R1,720 per tonne last year and has touched R1,864 per tonne this year. The cost of production has also increased from R1,435 to R1,813 per tonne.

What is the nature of linkage with APGENCO, the power generating company of Andhra Pradesh?

As per the linkages granted by the ministry of coal, SCCL has been supplying coal to thermal power stations of APGENCO. Both APGNECO and SCCL have renewed fuel supply agreement (FSA) for supply of 122.40 LT coal to the APGENCO thermal power station. The coal linkage of 21.6 LT of the Kaktiya thermal power plant, Chelpur, Bhoopalpalli, has been added to the present FSA. APGENCO is able to generate 2620 MW with 122.40 LT. The contract period of FSA is for 20 years and will be reviewed by both APGENCO and SCCL every five years.

What is the status of the proposed power project in Adilabad district?

The government of Andhra Pradesh had accorded investment approval to the detailed project report submitted by SCCL for 2X600 MW coal-based thermal plants with an investment of R5,685 crore. The land has been acquired and environmental clearances have also been approved. While NTPC is appointed as the consultant for preparing specifications and tender documents, the PPA has been signed with APTransco for sale of 1,050 MW and the rest would be used by SCCL for own consumption. We are awaiting the BOP (balance of plant) report and may be there could be an increase of R1,000 crore because of increase in the specifications. The project is expected to be commissioned by 2015.