NTPC finally makes it as integrated power company with own coal mining

After years of delay India's largest generation utility NTPC on Thursday finally realized its coal mining dream, putting on track efforts to secure fuel supplies and transform into an integrated power company.

Finance minister Arun Jaitley and Jharkhand chief minister Raghubar Das, at a function held in Ranchi, flagged off the rake carrying the first consignemnt of coal produced by the company from its Pakri Barwadih mine in the state. Initially, coal from this block will go to the company's Barh plant in Bihar.

Being a thermal power generator, NTPC is hugely dependent on coal. It has 19 coal-fired power stations, which consumed 161 million tonne of the dry fuel in 2015-16. Absence of captive coal mining has, thus, been a weak link in the company's corporate architecture so far.

The NTPC management knew this only too well as low coal stock at generation units and not knowing when the next rake was coming underlined the vulnerability during the days of fuel shortage plaguing the power sector till 2014.

This forced the company brass to start dreaming about foraying into hydel sector and coal mining to plug a strategic gap as a way to diversify and secure fuel basket. The hydel dream, though plagued by several problems, was realized in 2015. That placed NTPC among a select group of global peers who span the entire fuel chain — coal, gas, hydro power and renewables.

The coal mining foray took longer due to a variety of reasons ranging from squatters obstructing land acquisition, government cancelling allotment of the block and re-allotting it to appointing a new mine developer after cancelling the previous company due to delays.

Pakri Barwadih is just a beginning for NTPC, which will be the largest coal miner in the country after state monopoly Coal India Ltd once it brings to production all the blocks allotted to it. Besides Pakri-Barwadih, NTPC has been allotted Chatti-Bariatu, Kerandari, Dulanga, Talaipalli and Chatti-Bariatu (South), Banai, Bhalumunda in Jahrkhand and Mandakini B in Odisha.

These mines have total geological reserves of around 7.15 billion tonne and production potential of 107 million tonne per annum, good enough to fuel 20,000 MW generation capacity.

Pakri Barwadih has a capacity of 18 million tonne per annum and mineable reserve of 641 million tonne. In the next year, around 2-3 million tonne of coal is likely to be produced.

(Source: Times of India, Feb 16, 2017)