Coal India has been in the line of fire for not being able to increase output. It is in tiff with private power companies over fuel supply agreements. Hundreds of its proposals are awaiting green clearance. The Coal India Chairman and Managing Director, Mr S. Narsing Rao, discusses various facets of the rough patch the company isgoing through.
OUTSOURCING
We need to get more aggressive on outsourcing. In the next three months, we should be able to finalise the roadmap. We will identify the reserves and assess the annual output. We will determine the extraction percentage.
On a pre-determined price for every tonne, we would offer the contract for 10 or 15 years, based on market advantage. The life of the equipment would be matched with the life of the contract. We have already given three small contracts on this model.
IMPORT
It is very unlikely that we will import this year or even next year. We will entrust it to somebody who is experienced and has the expertise. There would be an agreement between them and users on our behalf.
This year, an equivalent of 18 million tonnes imported coal is required to meet 80 per cent of new fuel supply agreements (FSAs) and 90 per cent of old FSAs in 2012-13. This can go up to 30-32 million tonnes next year.
PRICE POOLING
This will not be at the cost of Coal India’s financial interests. We will not take even a single rupee’s hit. If price pooling is done as per Government policy, it should be outside the balance sheet of Coal India.
FUEL SUPPLY PACTS
Sooner or later, possibly there would be some middle ground. The board will take note of all the developments after approval of the earlier agreement on April 16. It will take an appropriate decision possibly this week.
ROAD AHEAD
We need to improve our planning, processes and project execution. There are issues created by external factors that we cannot do much about.
We would be investing Rs 5,000 crore for underground equipment during the 12th Plan. At this moment, production is important and raising coal price is secondary. In next five years, we should be able to achieve our target of 615 million tonnes output.
HURDLES
Our expansion programmes are in Mahanadi and Central coalfields. That is where we are facing lot of problems in land acquisition and rehabilitation. For forest clearances, cases have been pending since the past three-four years.