According to company sources, so far only Damodar Valley Corporation (DVC) – a major power producer in Eastern India – has indicated to CIL its estimated requirement of 0.8 million tonnes of imported coal, beginning second quarter of 2010-11.
The coal major was previously expecting to start its innings in international trade with a firm four-million-tonne order from India's largest user of imported coal, NTPC which consumes nearly one third of an estimated 40 million tonnes of thermal coal imported into the country.
However, CIL sources now confirm that the negotiations with NTPC did not reach a conclusive stage.
“As on date, we have the proposal for imports from DVC. We are hopeful to firm up the order in a month or two,” a CIL source told Business Line.
Coal import has become critical for the power sector due to the widening demand supply gap in thermal coal, and that too, at a time when emphasis is being laid on enhancing generation capacity in the country.
The Centre has already made it mandatory for new projects to be set up in the coastal areas to meet a third of its coal requirements through imports.
The power sector also imports low-ash thermal coal for blending with the domestic coal to meet the emission control norms.
DVC, for example, uses imported coal primarily on environmental considerations. DVC is a statutory body set up jointly by the Central Government and State Governments of Jharkhand and West Bengal. All its generating units are located in the coal-bearing areas of Damodar Valley.
Interestingly, CIL is not very hopeful of importing coal through the Haldia port in West Bengal, even to meet the requirements of the power plants located in close proximity.
“The landed cost of imported coal depends upon the size of ships, handling cost and rail transportation charges. The handing cost at Haldia is high due to pre-berthing delays. Also, the port cannot accommodate large ‘Capesize' or ‘Panamax' vessels, each carrying up to one lakh tonnes. Our initial assessment says that the final cost of importing through Haldia is higher than other ports on the east coast,” a CIL source said. However, he added, all such decisions would be finalised through tendering.