CoalMin asks CIL to sign FSAs for 78K MW capacity by Aug 30

The Coal Ministry has asked CIL and its subsidiaries to enter into fuel supply pacts with the power firms for a capacity of 78,000 MW by month-end. "The Coal Ministry has informally conveyed it to Coal India (CIL) and its subsidiaries to sign fuel supply agreements (FSAs) by August 30," a source close to the development said.

CIL board had on August 3 approved signing of FSAs for a capacity of 78,000 MW instead of earlier 60,678 MW, the source added.

The Coal Ministry had on July 17 issued a presidential directive to the maharatna firm, directing it to sign FSAs for about 78,000 MW.

Earlier, CIL was directed to sign FSAs for 60,678 MW capacity which was the projected requirement for 131 power plants commissioned or to be commissioned by March, 2015.

CIL has so far signed 82 FSAs of 34,793 MW capacities. These include 11 FSAs with NTPC and 5 FSAs with its joint ventures. On July 26, the coal ministry had said that CIL has signed fuel supply pacts with NTPC's 16 power plants and joint ventures, while 11 more agreements with the power major and its JVs are being processed.

NTPC had refused to enter into FSAs with CIL over quality issues of the dry-fuel supplied to it and had stopped payment to Coal India subsidiary, Eastern Coalfields Ltd.

Retorting to the step, the world's largest coal miner had temporarily stopped supply of fuel to NTPC. The issue was resolved following government intervention.