Indian power cos may shift focus to African continent for coal

Indian power cos may shift focus to African continent for coal

A delegation headed by Power Secretary P Uma Shankar recently travelled to the African continent to explore the possibility of extracting coal in South Africa and neighbouring African nations like Botswana and Mozambique.

"The visit (to South Africa) was good... Importing coal from African nations or picking of equity stakes in the coal mines, these are some of the options we have to look at," Power Secretary P Uma Shankar told PTI.

Shankar indicated that the Power Ministry may facilitate the import of foreign coal or acquisition of overseas blocks by Indian power generating companies.

"Lets see how it works... We would do it ourselves or through NTPC, that has to be decided... or may float tenders, it has to be seen, right now we are only looking at the possibilities," Shankar said.

"We all know that domestic fuel is not sufficient, we need to import fuel to fire our plants," he said, adding that South Africa, Botswana and Mozambique are some of the companies on the radar.

On being asked about cost escalation in power tariffs due to the use of imported coal, he said, "This is something we have to see, whether we want costly power or no power at all."

Meanwhile, state-run NTPC is scouting for coal properties abroad in order to secure the raw material for its projects. The company is looking at countries like Indonesia and Australia for the purpose.

The company may pick up stake in two coal mines in Indonesia, East Kalimanthan and Sumatra. The company is looking at striking a deal that is financially feasible. The company is also scouting for coal properties in the Australian continent and may acquire coal blocks in Queensland and North South Wales. It has identified 2-3 such properties.

NTPC's coal requirement is likely to touch 165 million tonnes (MT) in the next financial year (2011-12), of which it may import 12-15 MT. At present, state-owned trading firms State Trading Corp (STC) and Minerals and Metals Trading Corp (MMTC) source coal from abroad on behalf of NTPC. The company may soon be doing the task itself.
NTPC currently generates over 33,000 MW of power and plans to augment this capacity to 75,000 MW by 2017.