India's largest power producer NTPC may once again falter in bringing its captive coal mines under production even as a revised production schedule was finalised by the company early this year.
The work on company's Pakri-Barwadih captive coal block has remained suspended since February last year due to law and order issues and the company officials do not see an early resolution of the problem for the work to resume.
After numerous delays with regard to all its captive coal blocks that also attracted the wrath of both the coal ministry and the Prime Minister’s Office, NTPC expedited work and and intended to reach 3 million tonne per annum of coal production this fiscal from its first block. But with only three months for the year to end and no clarity on resumption of work at Pakri-Barwadih, officials believe that they would be lucky even to have some token production from this block.
“We can start mining activities at Pakri Barwadih coal mine within 48 hours of receiving the requisite support from the Jharkhand government in resolving the law and order problem at the mine site. But the problem has dragged for last several months and we are keeping our fingers crossed,” said an NTPC official asking not to be named.
NTPC was allotted six coal blocks (with 3 billion tonne of coal reserves) earlier and all these mines have been facing delays due to lack of statutory clearances and other land related issues. Recently, the government allocated another four blocks with 2 billion tonnes of reserves to the company. Barwadih block was supposed to reach an annual production of 15 mt in two years. However, all work has been suspended as an organisation supported by local MLAs for project affected persons (PAP) damaged mining machinery and prevented start of work.
“Slow disbursement of land compensation payment by the district administration has also aided local politicians to create law and order problems at Pakri-Barwadih mine site. NTPC has requested the formation of a Special Land Acquisition Cell exclusively for its land acquisition and at its own expense. But the progress is slow,”
Said a power ministry source aware of the development.
For NTPC, starting operations at the Pakri Barwadih block will be a major breakthrough as it has been been facing law and order problems on all its blocks in Jharkhand. The public sector producer has been allocated four blocks — Pakri Barwadih, Kerandari, Chhatti Bariatu and Chhatti Bariatu-II — in Jharkhand to feed its power stations.
The company has a appointed a Mine Development Operator for Chatti-Bariatu, while the process is on for the Kerandari block. The Talaipalli block is proposed to be developed jointly by Singrani Colleries and NTPC. In case of Dulanga, however, land issues need to be resolved.
“We have fast-tracked work on all of our captive blocks. We hope to increase production from them by 12 million tonne each year to reach 40 mt over the next four years, so that 25% of the company's fuel requirements are met through its own mines by 2017,” the NTPC official said.
The company's coal-based capacity is expected to rise to 52,000 MW by 2017 and production from captive blocks will help it eliminate dependence on expensive imported coal.
NTPC currently needs 160 million tonne coal to run its coal-based capacity of about 35,000 MW. About 16 million tonne of this coal is imported at prices that are almost two-and-a-half times the average coal price of R1,400 tonne offered by Coal India. In the first six months of 2013-14, NTPC imported 7.3 mt of coal, an increase of 68% against over the corresponding period of previous year. It had incurred a capital expenditure of R1,536 crore until the first quarter of 2013-14 to develop these mines.
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