NTPC floats tender for importing 4 mt of coal

New Delhi, Nov. 21:

NTPC Ltd has floated a tender on Monday for importing 4 million tonnes of coal to bridge the shortfall of the fuel from domestic sources.

The country's biggest power producer has decided to import the coal directly, rather than depend on designated trading agencies, to cut down on delays. Coming at a time when the rupee has weakened sharply against the dollar, higher coal imports by NTPC could spell bad news for consumers as the move could impact power tariffs. NTPC consumes around 164 million tonnes of coal a year to fire over two-thirds of its installed generation capacity of around 35,000 MW.

The imported coal is to be used across 14 of the power major's thermal stations in the coming months. NTPC is already in a pact to import around 12 million tonnes of coal through State Trading Corporation. The new tender, along with the STC contract, would make up the company's coal import target of 16 million tonnes set for the current fiscal.

In the coming future, NTPC is looking at striking long-term contracts spanning 25 years for sourcing 10-15 million tonnes to ensure steady supplies and lower price volatility.

NTPC's average imported coal blending during 2010-11 was close to 8 per cent in comparison to about 6.5 per cent in the previous year. This could be much higher this year, as the domestic coal shortage is only getting worse and imports are surging.

In the long-term, the state-owned power utility aims to meet about 20 per cent of its coal needs through captive mines by 2017. The Centre has allotted seven mines to NTPC, including two blocks to be developed through joint ventures.

(sourced BusinessLine)

Coal to keep burning on strong Asian demand

Sunday, Nov13,2011 Sourced AFP

LONDON — Coal is set to remain a major energy source alongside oil over the next 25 years on strong Asian demand, an uncertain outlook for nuclear power and despite the popularity of natural gas.

"Coal will be very competitive for a long time," Richard Jones, deputy executive director of the International Energy Agency told AFP in an interview.

"Coal will remain the main energy in many countries, principally China and India," Jones said last week as the IEA published its 25-year outlook.

"By 2020, when it comes to coal imports, India will be a new China as the largest importer of coal in the world." China is currently also the world's biggest consumer of the fossil fuel.

Companies in China and India are snapping up the world's coal assets to generate power, in particular electricity, that can fuel the countries' fast-growing economies.

Meanwhile new technologies helping to make coal a cleaner form of energy, and an expected decline in the use of nuclear power across developed nations after Japan's recent disaster, is set to boost demand for the mined fuel.

Germany recently announced that it plans to phase out nuclear energy by 2022 in the wake of the disaster at Japan's Fukushima plant in March.

"The immediate impact of the decision in Germany is to import more electricity from their neighbours, and a lot of this imported electricity is coal-fired," Jones said.

World coal production stood at 4.928 billion tonnes in 2009, providing around a quarter of the globe's total energy output, according to the IEA.

"The world ... coal market is perceived as structurally tight by many," Societe Generale analyst Emmanuel Fages said in a recent research note.

He added that that coal-hungry nations would continue to depend on the United States -- the world's second biggest producer of coal after China -- to boost supplies.

"The US have been a large coal exporter in the past. Recently they proved able to balance the market by increasing their export volumes ... The US export capacity evolution is thus important to the future global supply-demand equilibrium," Fages said.

The United States is increasingly looking to natural gas to meet its own huge energy needs, enabling it to help feed Asia's thirst for coal.

The US has become a global leader in the production of natural gas extracted from underground shale rock, helping to drive down the commodity's price on markets. Coal prices have meanwhile risen.

"Coal prices have benefited greatly in recent years because of this strong demand from China, and I don't see that changing," said Jones.

"We are looking at a modest increase (in prices) over the next 25 years, and at the same time, production cost will be stable."

China is also seeking to tap its vast shale gas reserves to reduce its reliance on coal. The world's biggest emitter of greenhouse gases relies on coal for nearly 70 percent of its energy needs.

Over the past eight years China has on average built one coal-fired power station a week -- and this after it used to be a major exporter of the natural resource.

The cost of securing coal from within China can be fatal however. Last week, at least 20 workers were killed and another 23 trapped underground after a blast at one of the country's mines.

Coal mine accidents are common in China, where work safety is often neglected by bosses seeking a quick profit.

Dispatch of coal to power firms a priority: Govt to coal miners

Tuesday, 1 Nov, 2011

NEW DELHI: Amid a severe disruption of electricity supply in different parts of the country due to an acute coal shortage, the government today said it has advised coal companies to ensure priority movement of the dry fuel to power stations to improve generation.

"The Ministry of Coal is regularly reviewing the coal stock position with the power plants of the country and government coal companies have been directed to give the highest priority to coal dispatches for the power sector," an official statement said.

In a bid to improve the stocks position at power stations, a total of 141 rakes carrying coal were dispatched to various units on October 30, it said.

"In addition to that, seven rakes and another 1,88,000 tonnes of coal were dispatched through the MGR (Merry-Go-Round transport mode, an exclusive arrangement made by the power stations themselves) to the power stations," it added.

In October, the railway load dispatched daily from CIL sources was 157 rakes, out of which 128 rakes were destined for power stations.

As per data released by Central Electricity Authority (CEA), 33 power plants with a total generation capacity of 39,054 MW across the country were facing an acute fuel shortage and had coal stocks for less than four days on October 28.

Power plants usually maintain 10-15 days of coal stocks. The situation is considered critical if the reserves fall below seven days' generation requirement.

The Coal Ministry said, "The stock position in the power stations of northern India has also been continuously reviewed. The average loading to these stations during the current month has been 44 rakes per day."

On October 30, a total of 51 rakes were dispatched, out of which 24 rakes were sent to the power stations of Uttar Pradesh alone. While three rakes were dispatched to the Unchahar plant, the Dadri project was sent 10 rakes. In addition, the thermal power station at Faridabad was sent 10 rakes and the Panipat plant four rakes.

During the last three days, 166 rakes have been dispatched to power stations in northern India. Regular coal supply is being maintained to power plants in Andhra Pradesh as well.

The Coal Ministry has attributed the shortage of coal to a number of factors, including lower production by Coal India on account of heavy rains in August-September and a strike at Singareni Collieries Company (SCCL), which has been called off.

Regular coal supply from SCCL has been restored, the ministry said last week, adding that it will take some more time for these plants to build up their coal stocks.

( sourced Economic Times)

30 thermal power plants including NTPC and Reliance Power have coal stock for just four days

Wed, 26 Oct, 2011

NEW DELHI: Coal stocks at India's thermal power plants are critically low on the eve of Diwali, and will not improve unless coal supplies are stepped up significantly, a senior power ministry official said. However, coal-sector authorities said dispatches to power plants had increased.

Coal Minister Sriprakash Jaiswal has directed coal companies to give top priority to power plants compared to other customers, but power stations are running with very thin stocks and supplies are not enough to build stocks to a comfortable level.

"The critical stock with power projects is a matter of great concern. The coal supply is sufficient for hand-to-mouth existence. There is no coal on railway sidings. Stock would not improve unless we get at least 30-40 additional rakes everyday. The silver lining, however, is that we are receiving 100% coal supply now and projects are operating at full capacities," a senior power ministry official said

Many plants, including units run by leading energy companies such as NTPC, Reliance Power, Sterlite and Damodar Valley Corp had coal stocks for less than seven days, a condition that the Central Electricity Authority says is "critical".

Latest CEA data shows that number power projects with critically low stocks of coal increased to 48 on Monday from 44 two weeks ago. Thirty plants had "supercritical" stock that would last less than four days. There are 89 coal based electricity generation stations in India that have a capacity of 86,000 mw.

NTPC's Singrauli, Mejia, Vindyachal and Damodar Valley's Kodarma projects and few other projects with about 9,000-mw had no coal stock as against a normative requirement of 15-20 days. On an average coal plants have stocks for barely seven days.

The power ministry official said coal stocks would continue to deplete unless about 190 rakes are dispatched to power sector alone. The coal ministry said a total 147 rakes were dispatched to power projects on Monday. In addition seven rakes and another 1,77,000 tonnes of coal was dispatched through exclusive transportation ties ups.

A coal ministry statement said a total of 181 coal rakes were dispatched to all consumers including power plants on Monday. "The coal companies have been advised to ensure priority movement of coal to the power stations of the country and their coal availability is improving," a coal ministry statement said.

The overall average rail loading from Coal India Ltd was 156 rakes per day, of which 127 were dispatched to power stations. During the last three days, 146 rakes have been dispatched to the power stations in northern India.

Heavy floods, strikes at mines and the Telangana agitation has crippled mining and loading operations in several states had depleted coal stock at power plants in trhe beginning of this month.

source ET

US$ 8 billion worth of infrastructure projects in pipeline in Indonesia -Wood Mackenzie

Tuesday, March08, 2011

India’s Increasing Demand for Thermal Coal cannot be satisfied without emerging coal areas in Indonesia - Wood Mackenzie

At Coaltrans India 2011 in New Delhi today, Wood Mackenzie says that emerging coal supply areas in Indonesia will be instrumental to meeting rapidly growing coal demand from India.

Drawing on information contained within Wood Mackenzie’s Coal Supply Service and Global Cost and Margin Tool, Presenter and Coal Research Analyst, Rohan Kendall said, “Indonesia will account for 40 percent of growth in seaborne thermal coal supply over the next ten years, with the emerging coal areas of the South Sumatra basin and Wahau coal field making an important contribution to this growth. There is US$8 billion of infrastructure projects in the pipeline in these emerging areas that will support export growth.”

Emerging coal regions are a good fit for developing economies, such as India, because the basins contain abundant reserves. These areas are experiencing upstream investment as Indian power generators such as Reliance and Adani look to secure coal supplies for new power stations. There are currently several ultra-mega power plants being built in India with a capacity of over 4,000 Megawatts each; and still more are planned. The projects currently in development are similar in capacity to those in China and are expected to be operational between the second half of 2011 and 2014.

Kendall expands, “Coal production costs are low in emerging basins in Indonesia, which is why they are attractive to Indian power generators. The costs of investing upstream to secure coal requirements are much lower than Indian power generators would otherwise pay if they were to purchase all of their coal on the seaborne market. Also, for power stations that are being built on the coast, it is more realistic to seek seaborne supplies which do not depend on India’s rail network for transport.”

Wood Mackenzie says in order for emerging thermal coal supply areas to fulfil their potential, infrastructure challenges need to be overcome. Kendall says, “There is currently insufficient infrastructure in these areas to support large scale coal exports. There are numerous projects proposed which combined would add 140 million tons per annum (Mtpa) of capacity. We believe that some of these are unlikely to progress given regulatory challenges.”

In summary, coal supplies from emerging basins in Indonesia are expected to increase strongly over the next ten years. The large reserves in these areas will be instrumental to meeting India’s future thermal coal requirements. Coal from emerging areas is cost competitive with established basins but the main question remaining is when and how the infrastructure issues can be overcome to bring the coal to market.

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Tags : Indonesian coal traders, suppliers, exporters, miners