The construction of a 12.5-km merry-go-round railway system to connect Mahanadi Coalfields Ltd’s mines in Kaniha (near Talcher, Odisha) to NTPC’s 3,000 MW super thermal power plant in the area faces an uncertain future with the passing of the new Land Acquisition Bill.
The process to acquire about 120 acres for the proposed system started more than five years ago but is unfinished. Only 11 acres have been acquired so far.
A large number of squatters occupying the land identified for acquisition refuse to vacate, allegedly with political backing. Some, even after accepting compensation at an enhanced rate.
NTPC is paying ex-gratia over and above the compensation amount declared by the State Government.
A total of 598 people in 11 villages have been identified as eligible for compensation; 323 of them have accepted the money and 114 have also got the ex-gratia amount. The new land law, it is feared, might complicate the process further as there may be demand for higher compensation.
The uncertainty comes at a time when an early commissioning of the rail system has become critical for the power plant. At present, the bulk of the plant’s coal requirement is met from Mahanadi Coalfields Ltd’s Lingaraj mines located 40 km away.
Production at the Lingaraj mines is set to decline as reserves are getting depleted. The new mines, if and when opened, will most likely cater to new private power plants being set up in the area. Mahanadi Coalfields Ltd has opened mines at Kaniha, ostensibly to take care of the requirement of NTPC’s super thermal power plant nearby.
But there are several problems. First, the current production at Kaniha is not enough to meet NTPC’s full requirement of 54,000-55,000 tonnes per day. Second, there being no silos nor any mechanical loading facility at the pithead, loading capacity is limited.
Finally, the existing 3.5-km-long railway line, a temporary arrangement linking one part of the Kaniha mines with the NTPC plant with a few km of road-bridging, has its own limitations. The proposed merry-go-round rail system, to be completed with silos and mechanical handling facilities at the pitheads, is therefore urgently needed.
NTPC has other reasons to worry. Since the concept of linking particular mines with a given power plant has been dispensed with, the coal companies are free to sell the production of a mine to any customer.
NTPC officials in Kaniha have reportedly learnt that Mahanadi Coalfields Ltd has signed a fuel supply agreement with a private group setting up a power plant in the vicinity. They only hope that the promised supply from the Kaniha mines will be maintained.
Unfortunately, that is not happening now. Coal shortage has been a constant source of concern for NTPC. The fuel supply agreement presupposes an assured supply of 17.3 million tonnes in 2013-14.
The pro-rata target till date is 7.8 million tonnes, of which 6.5 mt has been supplied, leaving a shortfall of 1.3 mt.
As a result, there has been a loss of more than 14 million units. For the past several months, one or both units of 500 MW capacity have had to be shut down for want of coal. If Mahanadi Coalfields Ltd’s is to fulfil the targeted supply for the current fiscal, it has to supply coal at the rate of 59,000 tonnes per day till March 2014 against the current 35,000 tonnes.