APGenco to take up coal mining in Orissa

State power utility plans to take up captive mining in Mahanadi coal fields

As part of its effort to augment coal supplies for present as well as future needs, the Andhra Pradesh Power Generation Corporation (APGenco) is planning to take up captive mining in the Mahanadi Coal Fields (MCL) in Orissa.

The APGenco officials, in a letter to Coal India Limited (CIL), requested the coal body to allot a coal block at Utkal in MCL for captive mining purposes. Officials of the Andhra Pradesh energy department are hopeful of a positive response to the proposal.

It may be recalled that APGenco, which has set a huge capacity-addition target for itself in the next two to three years, has already been negotiating with the state-run Singareni Collieries Company Limited (SCCL) for taking up coal mining jointly in the unexplored coal blocks in the state.

The availability of coal supplies have been one of the crucial prerequisites for the state's energy development programme as the fuel scarcity could adversely hamper the capacity-addition plan in the thermal sector, especially with the country facing coal scarcity.

In fact, the acute coal shortage has made the Union government ask Punjab to go in for imports to meet its coal requirements.

At present, the state power utility is purchasing about 8 million tonnes of coal from Talcher (MCL) and around 10 million tonnes from Singareni Collieries for its generating stations. As per the expansion plans announced by APGenco, the new units need another 8 million tonnes of coal.

At present, the Vijayawada Thermal Power station (VTPS) and the Rayalaseema Thermal Power Project (RTPP) have been fed by MCL coal, and both the plants are going in for a combined capacity addition of about 1,000 mw in the next couple of years.

According to sources in the energy department, MCL is also in the process of allotting a dedicated mine to APGenco within a five-kilometre radius from the coal washery, which was proposed to be set up for APGenco on a build-own-operate (BOO) basis.

At present, MCL produces 60 million tonnes of coal while SCCL produces around 35 million tonnes of coal a year.

"If SCCL fails to increase its production capacity to 40 million tonnes in the next two to three years, the state would face a difficult situation," an energy department official told Business Standard.