Published On : Thu, Nov 7th, 2019

WCL dedicates specific mines for Power Sector

In order to augment sustainable coal supply to Power Plants, Western Coalfields Ltd. (WCL) has dedicated 11 specific mines exclusively for Power Sector consumers linked to the company. This special initiative has been taken to dispatch assured maximum volume of coal from these mines to all Linked Power Plants drawing coal under different schemes from WCL. Special focus will be on to provide help in enhancing dispatch of quality & crushed coal both through Rail & Road mode. This will be in addition to supply from other mines as per defined quantity. Maximising assured coal supply to these plants to meet their requirement will not only help in sustained more power generation but will also restrict thermal coal import in national interest.

Dispatches of coal from WCL to Power Sector has gone up significantly from 62% in 2013-14 to 81% in 2018-19. Out of 55.5 million tones of total coal dispatch during 2018-19, over 45 million tonnes of coal was dispatched to Power Sector. Prominent power consumers are State Gencos of Maharashtra, Madhya Pradesh, Gujarat, Karnataka, Haryana and NTPC along with private Power consumers. Major share of coal dispatch is consumed by Mahagenco(50%) followed by MP(12%). Share of other 3 Gencos and NTPC is 7% & Pvt Plants consume 12% of coal. WCL supplied about 5 Million tonnes coal each under Spot Auction & Non-Power Linkage Auction during 2018-19.

Coal production from WCL came down to an alarming level of 39.73 Million Tonnes during 2013-14 from a peak of 45.74 Million Tonnes during 2009-10. Non-availability of land in possession & non-viable projects posed a threat to the future of the company. State Genco of Maharashtra along with other consumers of Central, Western & Southern India were depending on coal supply from Eastern India based Coal Companies bearing higher Rail freight resulting in high landed cost of coal.

All out effort was made for immediate augmentation of coal production by giving dispensation for land possession & in depth technical revisit of unviable mines for their viability. With the solution in hand, WCL could get immediate possession of land resulting in opening of new projects from early 2015 onwards. In last 5 years WCL could possess 8364 hectares of land & opened 20 projects comprising of 8 Greenfield & 12 Brownfield projects with an investment of Rs.6543 Crores. In between 22 projects contributing 22 million tones of production closed down due to exhaustion of coal reserve. In fact, production of WCL would have come down to almost 17 million tonnes by 2018-19, but 20 new projects started adding production on year to year basis from 2014-15 onwards & WCL could achieve its highest ever production of 53.18 million tonnes during 2018-19. Contribution from these new projects was 35.82 million tonnes during 2018-19.

With sustainable rise in production, WCL could slowly bring back to its fold the nearby consumers earlier taking coal from SECL, MCL by providing coal almost at their doorstep resulting in less rail freight & cheaper landed coal cost. Coal dispatch to Mahagenco rose from 16 million tonnes in 2013-14 to 28 million tonnes in 2018-19. Similarly more coal could be made available to other nearby State Gencos & other non-power consumers during last 5 years resulting in huge savings to their entity on freight account.

WCL is heading for a coal production of more than 60 million tonnes during 2019-20. Further, WCL has also planned to open another 20 mines in first phase in next 3-4 years followed by further 11 mines in second phase to reach upto a level of 100 million tones of production in next 7-8 years. The plan is to make available sufficient volume of non-coking coal from nearby source to consumers of Central, Western & Southern part of our country to stop import of thermal coal. This effort of WCL is even after having toughest mining condition in comparison to other subsidiaries of Coal India. Presence of Black Cotton Soil, old loss making underground mines, high stripping ratio in opencast mines making coal extraction deeper & deeper & inherent low grade of coal results in critical financial condition of the company.

WCL has now identified 11 out of its 63 existing mines as specific mine source to provide maximum volume of coal to its linked Power consumers. These mines consist of 8 Greenfield Projects opened during last 5 years & 3 Brownfield Projects. All linked power consumers taking coal under different schemes will be offered almost full volume of production from these mines. As a Mine Specific Source, WCL will be sharing Rs.450 per tonne from the savings of the consumers on account of making more & more cheaper coal available almost at their doorstep. This will also be helpful for financial sustainability of WCL & will be a win-win situation for both. Non-power linked consumers & Spot Auction consumers will continue to take sufficient quantity of coal from remaining sources of WCL other than these mine specific sources.