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L&T, KPCL close to deal for a coal mine acquisition
Engineering major L&T Ltd and Karnataka Power Corporation Ltd (KPCL) are on the verge of entering into a joint venture agreement for acquiring a coal mine in Indonesia.
KPCL, Mr Jaamdar said, was pushed into looking for alternative coal sources. KPCL was faced with a shortage supplies from Coal India in view of flooding in Mahanadi Coal fields. He said, "We need to ensure fuel supply security for our generating stations." Stockyard position is currently precarious, with only about 12 days supplies. Besides, thermal plants were now being fully utilised in view of low reservoir inflows.
KPCL's annual coal requirements are estimated to be in the region of about 17 lakh tonnes a year for its eight units (8 x 210 MW) of the Raichur Thermal Power Station and the 500 MW Bellary Thermal Power Station. KPCL was importing some of its coal requirements from Indonesia and other South East Asian sources.
Tariffs
However, there were tariff pressures. Imported coal currently costs about $200 (Rs 8700) a tonne cost insurance and freight. Domestic coal costs Rs 3,000 a tonne. Coal prices were treated as pass through item for fixing power tariff. Mr Jaamdar said the tariff impact was mitigated in view of the high efficiency of international steam coal.
