CIL jittery over coal ministry’s stiff stock target

By: |
November 05, 2021 1:30 AM

A former CIL CMD said on the condition of anonymity that the ministry's demand means to supply 48 days' coal requirement in 30 days. “The PSU miner's production will depend on its capacity and capacities are not built overnight,” he said.

Meeting the power plants' regular coal requirements and creating an 18-day stockpile would entail coal despatches of 109 MTs to the power sector during November.Meeting the power plants' regular coal requirements and creating an 18-day stockpile would entail coal despatches of 109 MTs to the power sector during November.

The target set by the Union coal ministry of creating 18 days’ coal stock at power plants by November end has made Coal India (CIL) jittery even as the PSU miner says it will keep ramping up production to meet the power sector’s requirements.

A CIL official told FE that production picks up from the second half of the fiscal and gains tempo from the start of the third quarter. CIL has targeted to produce in excess of 2 million tonne a day. The power sector’s daily requirement is around 1.8 MTs a day at the current level of generation. Despatches in the last week of October from CIL and other sources have been to the tune of 2.2 MTs a day, creating 11 MTs of stock equivalent to 6 days’ consumption, as of November 1. So, CIL will need to create roughly around 50-55 MTs of stock at the plants by November end, the official said, but refused to comment on whether it was achievable.

Coal minister Pralhad Joshi has asked CIL to make efforts to ensure 18 days’ stock at the plant heads by November end.

A former CIL CMD said on the condition of anonymity that the ministry’s demand means to supply 48 days’ coal requirement in 30 days. “The PSU miner’s production will depend on its capacity and capacities are not built overnight,” he said.

Meeting the power plants’ regular coal requirements and creating an 18-day stockpile would entail coal despatches of 109 MTs to the power sector during November.

According to Subrata Chakravarty, former CMD, Eastern Coalfields, despatches are hindered from the month of November and for most of the winter due to dense fog, especially in northern India. But it doesn’t hamper power generation since power plants are able to build up certain amount of stock after the monsoon is over. Despatches, though delayed, are regular and the PSU miner comes up to a position of meeting the power plants’ daily coal requirement. “But too much pressure on CIL and its subsidiaries may lead to compromise in quality, which is undesirable for consumers,” Chakravarty said.

A ministry official said 10 MTs of imported coal and production increase from captive mines may make 18 days’ stock feasible by November end. The ministry expected every mine to ramp up coal production so that stocks can attain its normative level of 21 days in the near future.

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