Coal India must give written assurance on quality: NTPC
It seems like a never-ending story, with neither NTPC nor Coal India Ltd (CIL) willing to bow on quality issues.
Now, power generator NTPC wants a written assurance from CIL that it will maintain coal quality and only then will NTPC ink fuel supply agreements (FSAs).
“They (CIL) will have to give in writing about the quality. Else, we will not sign the FSAs,” Arup Roy Choudhury, Chairman and Managing Director of NTPC, told Business Line.
NTPC is in queue to sign fuel supply pacts for 8,710 MW.
Till now, it was buying coal on the basis of a memorandum of understanding (MoU) for this capacity. This arrangement is valid till March 31. The FSA, being regularly renewed after every three months, has been pending since the past few quarters.
At present, 90 per cent of NTPC’s coal requirement of 164 million tonnes is met through Coal India and the remaining through imports.
Explaining why NTPC was insisting on such an assurance, another company executive said NTPC plants use specific grades of coal, but supplies from Coal India had a mix of other grades, which were of inferior quality.
Coal with calorific value of 3,100 kilocalorie and above per kg is suitable for NTPC.
But, the supplies have had a mix of coal with much lower calorific value.