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Tuesday, 19 October 21
COAL INDIA, THE FALL GUY FOR POWER CRISIS - INDIA EXPRESS
The post-Covid economic recovery has led to a major increase in the demand for power, both in India and globally. In India, coal-based power plants have witnessed rapid depletion of coal stocks from a comfortable 28 days at the end of March to a precarious level of four days by the end of September. The country is struggling to understand how the crisis is likely to pan out in the near future. Coal India Ltd (CIL) has been unfairly attacked, even as it gears up to play a crucial role in fighting the power crisis.
The reasons for the crisis are not hard to find. These are structural as well as operational. A government-appointed committee in the early 1990s concluded that CIL “cannot be expected to meet the demand of the power sector, in case the pace of capacity addition accelerates.” This led to an amendment in the Coal Mines Nationalisation Act (CMNA) in 1993 that enabled the government to take away 200 coal blocks of 28 billion tons from CIL and allocate them to end-users for the captive mining of coal. These end-users, mostly in the private sector, failed to produce any significant quantity of coal to meet the rapidly rising power capacity between 2007 and 2016. The cancellation of 214 blocks by the Supreme Court added to the problem.
Commensurate to the captive mines allocated to the end-user industries, the coal production today should have been at least 500 million tonnes per annum (mtpa). In reality, this has never exceeded 60 mtpa. CIL, with denuded reserves, is called to meet the rising gap in coal supplies. These structural factors fuelled not just over-expectations from CIL, they also kept the company in a constant state of stress.
On the operational side, power plants are required by the Central Electricity Authority (CEA) to maintain a minimum stock of 15 to 30 days of normative coal consumption, depending upon the distance of the plant from the source of coal. The compliance with this directive by power plants has been severely lacking. This enhances the vulnerability of power plants, particularly those at longer distances, to supply constraints on account of the coal producer or transporter.
The persistent non-payment of coal sale dues by power plants to coal companies has created a serious strain on their working capital position. Some companies were forced to borrow from banks to meet the operational expenses, including disbursement of salaries. According to reports, Rs 18,000 crore is currently due to coal producers.
The persistent shortage of coal production by the privatised and captive mines forced India to import around 200 million tonnes (mt) of coal. Of this, more than 40 per cent goes to meet the demands of power plants. A spurt in imported coal prices, mainly due to a major increase in coal imports by China, acted as a brake on imports of coal. This escalated the demand for domestic coal.
Simultaneously, from August, the demand for thermal power witnessed a sudden rise after stagnating for over three years. The spurt in demand for coal is being linked to the post-Covid economic recovery. In the short run, the coal production by CIL has faced severe headwinds in the first quarter due to the second wave of the pandemic. Thousands of workers and officers were infected and hospitalised and more than 250 CIL employees lost their lives. In the second quarter, the extended monsoon severely affected open-cast mining. These added to supply disruptions and aggravated the crisis.
Despite so many constraining factors, it is to the credit of CIL that it has achieved a growth of 14 million tonnes (mt) or 5.8 per cent in coal production during the first half of 2021-22. Yet, the offtake was higher than the preceding year by 52 mt or 20.6 per cent. This was possible by drawing down on the opening inventory of coal from 100 mt to 42 mt during April to September.
With the monsoons behind us and the onset of a good productive season, CIL has already stepped up coal offtake to more than 1.5 mt per day. It is expected to rise further to 1.6/1.7 mt in the next few weeks. With these efforts, supply will match, if not exceed consumption. With efforts on the part of the railways in moving the coal, the crisis should dissipate in the near future, at least for power plants that pay timely for coal supplies. Obviously, it will take a few months for coal stock at power plants to climb to comfortable levels in line with the CEA’s norms.
Besides meeting the growing coal demand of power plants, CIL has been able to significantly replace the import of highly expensive thermal coal. Even after bearing the highest tax and transport cost globally, the landed cost of CIL coal continues to be much cheaper than imported coal at almost all destinations. The resultant benefits are savings of foreign exchange, and generation of power at affordable tariffs. The coal price charged by CIL, expressed in energy units, is at a deep discount of 60-70 per cent of imported coal.
In brief, CIL has been unfairly blamed for the coal crisis. It has played a stellar role, standing like a solid rock between light and darkness. It is striving to build comfortable stocks at the power plants, not in default of payment. The company has ramped up coal production despite the 1990s policy that took away coal blocks of 28 billion tonnes of reserves. It is time that the country recognises the critical role of CIL. It needs bouquets rather than brickbats.
Source: The India Express
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Tuesday, 07 December 21
COAL FIRMS SEE SHARE PRICES SURGE MONDAY, AFTER GOVERNMENT READJUSTS CONTRACT PRICES - GLOBAL TIMES
Share prices of China’s coal enterprises jumped on Monday on the A-share market following a nationwide adjustment to annual thermal coal pric ...
Monday, 06 December 21
CHINA SETS 2022 ANNUAL THERMAL COAL PRICES AT 700 YUAN/T - MEDIA: REUTERS
China’s top economic planner has proposed to set annual thermal coal prices for 2022 at between 550 yuan and 850 yuan ($86-$133) per tonne, a ...
Thursday, 02 December 21
BUMI RECORDED US$ 666.18 MILLION AS REVENUE IN THE 3RD QUARTER, UP 13.31% YOY
PT Bumi Resources Tbk and its subsidiaries have recorded a surge in revenue in the third quarter of 2021. BUMI has recorded US$ 666.18 million as r ...
Thursday, 02 December 21
CHINA'S COAL CRUNCH IS OVER, BUT PRICES ARE STILL TOO HIGH - REUTERS
China’s coal crisis has largely been resolved with gains in both production and stockpiles sufficient to ensure power supplies over winter.
...
Wednesday, 01 December 21
2022 OUTLOOK: INDONESIAN COAL MINING - FITCH RATINGS
Fitch Ratings has a neutral outlook on the Indonesian coal sector for 2022.
Earnings generation should slow down as selling pr ...
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- Independent Power Producers Association of India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- Sakthi Sugars Limited - India
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Krishnapatnam Port Company Ltd. - India
- IHS Mccloskey Coal Group - USA
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Leighton Contractors Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Sical Logistics Limited - India
- Eastern Energy - Thailand
- Coal and Oil Company - UAE
- Price Waterhouse Coopers - Russia
- Port Waratah Coal Services - Australia
- Bukit Makmur.PT - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Grasim Industreis Ltd - India
- Mercator Lines Limited - India
- Bhoruka Overseas - Indonesia
- Sree Jayajothi Cements Limited - India
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- SMC Global Power, Philippines
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- Kideco Jaya Agung - Indonesia
- GMR Energy Limited - India
- Minerals Council of Australia
- Cement Manufacturers Association - India
- Attock Cement Pakistan Limited
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- Petron Corporation, Philippines
- Anglo American - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Bhushan Steel Limited - India
- Billiton Holdings Pty Ltd - Australia
- Energy Link Ltd, New Zealand
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Economic Council, Georgia
- Ministry of Transport, Egypt
- Manunggal Multi Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Pipit Mutiara Jaya. PT, Indonesia
- Videocon Industries ltd - India
- Mercuria Energy - Indonesia
- Wilmar Investment Holdings
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- International Coal Ventures Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Larsen & Toubro Limited - India
- Essar Steel Hazira Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- Kepco SPC Power Corporation, Philippines
- Posco Energy - South Korea
- Alfred C Toepfer International GmbH - Germany
- SN Aboitiz Power Inc, Philippines
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Simpson Spence & Young - Indonesia
- The State Trading Corporation of India Ltd
- Borneo Indobara - Indonesia
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Goldman Sachs - Singapore
- GAC Shipping (India) Pvt Ltd
- New Zealand Coal & Carbon
- Orica Mining Services - Indonesia
- Mjunction Services Limited - India
- Parliament of New Zealand
- Riau Bara Harum - Indonesia
- Coalindo Energy - Indonesia
- Thiess Contractors Indonesia
- Samtan Co., Ltd - South Korea
- Commonwealth Bank - Australia
- Kalimantan Lumbung Energi - Indonesia
- Bangladesh Power Developement Board
- Edison Trading Spa - Italy
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vizag Seaport Private Limited - India
- Ministry of Finance - Indonesia
- Mintek Dendrill Indonesia
- Kumho Petrochemical, South Korea
- Medco Energi Mining Internasional
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
- Bhatia International Limited - India
- Central Java Power - Indonesia
- Global Business Power Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Ambuja Cements Ltd - India
- SMG Consultants - Indonesia
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Karaikal Port Pvt Ltd - India
- Makarim & Taira - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Parry Sugars Refinery, India
- Semirara Mining Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Sojitz Corporation - Japan
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- Maheswari Brothers Coal Limited - India
- Agrawal Coal Company - India
- Indika Energy - Indonesia
- Tata Chemicals Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- San Jose City I Power Corp, Philippines
- Wood Mackenzie - Singapore
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Singapore Mercantile Exchange
- Aboitiz Power Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Asmin Koalindo Tuhup - Indonesia
- Bulk Trading Sa - Switzerland
- Bahari Cakrawala Sebuku - Indonesia
- Kartika Selabumi Mining - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- MS Steel International - UAE
- Electricity Authority, New Zealand
- White Energy Company Limited
- Bukit Asam (Persero) Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Altura Mining Limited, Indonesia
- The Treasury - Australian Government
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Maharashtra Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Bharathi Cement Corporation - India
- South Luzon Thermal Energy Corporation
- TeaM Sual Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- ICICI Bank Limited - India
- Planning Commission, India
- Marubeni Corporation - India
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Lanco Infratech Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Latin American Coal - Colombia
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Xindia Steels Limited - India
- Australian Commodity Traders Exchange
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Meralco Power Generation, Philippines
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Banpu Public Company Limited - Thailand
- Straits Asia Resources Limited - Singapore
- Rashtriya Ispat Nigam Limited - India
- The University of Queensland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Baramulti Group, Indonesia
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Interocean Group of Companies - India
- Uttam Galva Steels Limited - India
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Aditya Birla Group - India
- Pendopo Energi Batubara - Indonesia
- Sindya Power Generating Company Private Ltd
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Binh Thuan Hamico - Vietnam
- Iligan Light & Power Inc, Philippines
- ASAPP Information Group - India
- Georgia Ports Authority, United States
- LBH Netherlands Bv - Netherlands
- Eastern Coal Council - USA
- Star Paper Mills Limited - India
- Indo Tambangraya Megah - Indonesia
- Siam City Cement - Thailand
- Siam City Cement PLC, Thailand
- Carbofer General Trading SA - India
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