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SECURING COAL SUPPLY
THROUGHINDIGENOUS AND FOREIGN
SOURCES
T.K. Chatterjee
E.D.(FM),NTPC
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Basic Coal Facts
Countries Fall under distinct categories due to
uneven distribution of coal resources
TierI Countries: Self Sufficient or better : North
America & Russia
Tier- II Countries: Prime Exporter: Australia,Indonesia & Colombia
Tier-III Countries: Facing possible shortfall from
indigenous supply: India & ChinaTier-IV Countries: Facing possible shortfall of
imported Coal: Japan, Korea and much of
Europe
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World Coal ScenarioTop Ten Hard Coal Producers in the World in 2007
PR CHINA 2549 MT
USA 981 MT
INDIA 452 MT
AUSTRALIA 323 MT
SOUTH
AFRICA
244 MT
RUSSIA 241 MT
INDONESIA 231 MT
POLAND 90 MT
KAZAKHSTAN 83 MT
COLUMBIA 72 MT
Global hard Coal
consumption
1990 2006 2007
WORLD 3461 5164 5522
Source: BP, IEA,WEC
1990
24%
2006
37%
2007
39%
0%
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Coal in World Electricity Generation2006
POLAND 93%
S.AFRICA 93%
AUSTRALIA 80%
PR CHINA 78%
ISRAEL 71%
KAZAKHSTAN 70%INDIA 69%
MOROCCO 69%
CZECH
REPUBLIC
59%
GREECE 58%
USA 50%
GERMANY 47%
TOP COAL IMPORTERS(2007)
JAPAN 182MT
KOREA 88MT
CHINESE
TAIPEI
69MT
INDIA 54MT
PR CHINA 48MT
GERMANY 46MT
TOP COALEXPORTERS(2007)
AUSTRALIA 244MT
INDONESIA 202MT
RUSSIA 100MT
COLUMBIA 67MT
SOUTH AFRICA 67MT
PR CHINA 54MT
USA 53MT
Source: BP,IEA,WEC
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GLOBAL PRIMARY ENERGY SUPPLY AND TOTAL
WORLD ELECTRICITY GENERATION BY FUEL
Source: BP,IEA,WEC
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Coal Reserves in India
(as on 01-01-08) Billion tonnes
Proved Indicated Inferred
Coking 17 13 2
Non-Coking 79 106 36
Total 96 119 38
Source: MOC
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RAW COALPRODUCTION IN INDIA
5
55
AR
MILLION
TONN
Growth of coal production is 6. % whereas demand forelectricity has been growing at an average growth rateof 7% to 8% and demand supply gap has widened overthe years.
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Existing Generating Capacity- Sept,2009
Fuel wise break-up (MW)
COAL 80,396 53%
GAS 16,449 11%
OTHERS 55,515 36%
TOTAL 152,360 100.0%
(All figures provisional from CEA)
FOR NTPC : COAL BASED-24395MW
GAS BASED 3955 MW
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COAL REQUIRMENT,AVALIABILITY DURINGXI PLAN FOR
POWER SECTOR[ Source:CEA Presentation made on 30.09.09 in the Fuel Infrastructure Meeting under the
Chairmanship of Member(Energy)]
Sl.
No.
Details 2007-08# 2008-09#` 2009-10# 2010-11 2011-
12
a) Indigenous coal
requirement
340.0 377.6 401.0 434.0 488.0
b) Requirement of importedcoal for imported coal
based projects
-- 0.4 3.0 10.0 19.0
c) Total coal requirement 340.0 378.0 404.0 444.0 507.0
d) Indigenous coal availability
from:-
i) CIL 278 294 313 335 360
ii) SCCL 30 30 30 32 32
iii) Captive mines 11 19 20 21 22
e) Total availability of
indigenous coal
319 343 363 388 414
f) Shortfall in indigenous coalavailability (a-e)
21 34.6 38.0 46.0 74.0
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29894
75000
50000
As on today 2012 2017
INSTALLEDCAPACITYINSTALLEDCAPACITY
MULTI PRONGED APPROACH TO
CAPACITY ADDITION
GREENFIELD PROJECTS
BROWNFIELD EXPANSION
JOINT VENTURES
ACQUISITIONS
DIVERSIFICATION IN RELATED
BUSINESS AREAS
HYDRO PROJECTS
COAL MINING
POWER TRADING
OIL / GAS EXPLORATION
LNG VALUE CHAIN
RENEWABLE
NUCLEAR
MULTI-PRONGEDGROWTH
STRATEGY
Projects underconstruction 16,180 MW
NTPCGROWTHSTRATEGY
Vision 2017 and beyond..2030
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11
NTPCs Vision By 2017
At Present 2011-12 2016-17INSTALLED
CAPACITY (MW)29,894 ~ 50,000 ~ 75,000
COAL MINING
PRODUCTIONFROM INDIGNOUSMINING
-- 12 MTPA ~ 47 MTPA
A 75,000 MW+ Integrated Power Company by the year 2017
Vision 2017 and beyond..2030
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COALSUPPLYTONTPC STATIONS
Y AR
ILLIONTO
NN
S
The graph shows an ever increasing demand for more coal as NTPC kept on
building additional generation capacity over the years
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NTPC's Coal Requirement (Million Tes)
0
50
100
150
200
250
300
350
In the current year,coal shortage of20 million tes is envisaged which
NTPC plans to bridge through import
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Areas of Concern in Eastern Region-IShortfall mitigation at Farakka & Kahalgaon
The import supplement required for Farakka &Kahalgaon is 6 million tonnes. The domestic coalavailability for Farakka & Kahalgaon is 15 milliontes on the basis of assurance of CIL.
As blending of imported coal with domesticcoal cannot be increased beyond 15%, weneed to mandatorily tie up 6 million tons ofdomestic coal from CIL. Coal production andevacuation arrangements to be expedited at
Chuperbhita and Hurra C.
The import requirement would then be reduced to3 million tonnes.
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Areas of Concern in Eastern Region-I
Railway bottle necks for Farakka and Kahalgaon
Railways are ensuring supply of 10 rakes/day
but Andal-Saithia and Sahibganj -Kahalgaon
single line route is congested. Less Availability of BOBR rakes is also a
concern.
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as ern eg on-
Enablers for Coal sufficiency at Farakka & Kahalgaon Coal can be transported through Inland waterway no-1 i.e
Ganga passes through Farakka, Kahalgaon and Barh whereNTPCs 03 super thermal stations are located. The receivingport for imported coal can be Haldia.
Feasibility of receiving imported coal via IWT is being studied Availability of more Railway rakes@10 rakes a day as per their
assurance. Augmentation of existing unloading infrastructure at Farakka to
handle 8 railway rakes a day.
9 to 10 rakes a day of Total coal on offer from Lalmatia to besupplied to Kahalgaon.
Augmentation of unloading arrangements at Kahalgaon-II to handle9-10 rakes a day.
Continue Supplying imported coal at Kahalgaon and Farakka
Early Coal Availability from Captive Block ofPakri Barwadih
Early availability of coal from Brahmini mines
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Areas of Concern in Eastern Region-IIShortfall mitigation at Talcher Kaniha
Expeditious development of Kaniha mines and MGR link to
Kaniha wharf wall.
Railways to assure supply of 7 rakes a day on sustained basis.
Sustained supply of 35,000 TPD from Lingaraj mine by MCL.
Augmentation of present MGR network to facilitate Additional
number of Railway and MGR Rakes
Improvement of Surface miner availability/reliability from 1 to 3
numbers.
Supply of Imported Coal to continue.
Inland water transport route to be explored.
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Fuel Tie up Status for XI Plan
projects Fuel has been tied up for all projects
envisaged to come up in the 11th plan
except Farakka-III, Mauda U#2 and
VSTPP-IV
Railway movement clearance has been
obtained for all 11th plan projects except
Vallur-II,VSTPP-IV and Muzaffarpurwhichis awaited.
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Coal Requirement for 11th plan projectsCapacity
MW
Long Term
Linkage
MT
2011-12
MT
2016-2017
MT
Gap w.r.t
Linkage
(2016-17)MT
Sipat-I 1980 10 11.04 11.04 1.036
Barh 1980 10 3.75 11.24 1.239
Korba III 500 2.233 2.79 2.79 0.554
Simhadri II 1000 2.31 5.37 5.37 3.059
NCPP Expn 980 4.62 5.01 5.01 0.394
Bongaigon TPS 500 1.65 1.66 1.66 0.006Bongaigon TPS 250 0.97 1.06 1.41 0.437
Mauda 1000 5 1.42 5.68 0.676
Rihand III Unit-I 500 1.77 0.21 2.49 0.721
Vindhyachal-IV 1000 4.62 0.22 5.22 0.600
Barh-II 1320 0 0.94 7.49 7.49
Farakka-III 500 0 3.63 3.63 3.631
Nabinagar 1000 5 3.67 5.68 0.68
Vallur -I 1000 4.62 5.37 5.37 0.34
Vallur-II 500 2.31 0.22 2.68 0.37
Jhajjar 1500 6.94 8.05 8.05 1.11
Muzaffarpur Expn 500 2.31 0.74 3.55 1.24Subtotal 16010 64.353 55.15 88.36 23.583
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Coal Requirement for 12th plan projectsCapacity
MW
Long Term
Linkage
MT
2016-2017
MT
Gap w.r.t
Linkage
(2016-17)MT
Rihand III U=2 500 2.31 2.49 0.181
Solapur 1320 6.09 7.49 1.403
Kahalgaon III 500 2.31 3.58 1.27
Darlipalli 3200 12.5 14 1.50
Lara 4000 7 15.89 8.89
Darlipalli II 1600 7.39 9.08 1.69
North Karanpura 1980 10.24 11.24 1.0
Gadarware 2640 12.19 15.40 3.21
Marakkam 4000 18.48 16.34 -2.14
Vindhyachal-V 500 2.31 3 0.69
Singrauli III 500 2.31 3 0.69
TTPS II 1320 6.09 7.91 1.82
Kudgi 2400 11.08 13.07 1.99
Tanda Expn 1320 0 5.99 5.99
Jhajjar II 1000 4.62 5.08 0.46
Meja 1320 6.09 7.32 1.23
New Nabinagar 1980 9.14 10.98 1.84
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Projected Coal deficit (Gap) for Existing and
projects coming up in 11th and 12th plan
in the terminal year 2016-17NTPC Stations 2016-17
(MT)
Existing stations 12.11
Projects in the 11th plan 23.583
Projects in the 12th plan 31.714
Total 67.407
The Deficit coal requirement is planned to be met through captive mining of
coal blocks allotted to NTPC and import Substitution
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Reasons for Coal shortage
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Coal availability scenario for NTPC
Out of expected coal based capacity
addition of about 30,000 MW by 2016-17,about 19, 000 MW will be on linkage mode
and balance 11,000 MW on integrated
mode.
The total coal shortage for power sector is
expected to be about 87 million tes by
2016-17
FUTURE SCENARIO
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Reasons for coal shortage
The long term linkage for NTPC stations
correspond to 85-90% PLF level whereas the
generation target is at 92% PLF.
Growth in the coal sector not commensurate
with nations requirement of +8% GDP
growth.
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Slow clearance of projects. In some cases linked
mines are yet to be developed even though the
power projects have been implemented onschedule. This is resulting into under utilization of
installed capacity.
Ad hoc coal supply arrangements incurring
additional expenditure.
Further burdening of already burdened Rlytransportation network.
Reasons for coal shortage
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Reasons for coal shortage
Coal reserves are generally localized.
Transportation of coal is an issue.
Judicious rationalization of coal supply not
done due to various political and other
reasons.
Logistic Constraints
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Long term Measures to mitigate coal shortage
Backward integration into coal mining.
Resorting to integrated power project
with captive coal source concept.
NTPC is contemplating acquiring assets
abroad as a measure of long term fuel
security and to beat the current volatility
in the coal prices in the international
market.
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Strategies for
Coal Sourcing
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COAL
SECURITY
IMMEDIATEMEDIUMTERM
LONGTERM
IMPORT
E-AUCTION
DEVELOP CAPTIVE
MINING BLOCKS
ON FASTTRACK
MODE
MININGOF POTENTIALCOAL BLOCKSTHRU
JV ROUTE
WITH CIL
INLAND
WATER TRANSPORT
DEDICATEDFREIGHT CORRIDOR
SETTINGUPCOALWASHERIES
ACQUISIONOF COAL
BLOCKSABROAD
PARTICIPATE INPORT
DEVELOPMENT
FUELSUPPLYAGREEMENT
Bi-Lateral
Arrangement over
And above ACQ
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Fuel Supply Agreement
As per NCDP, power utilities to besupplied 100% of the normative coalrequirement with FSA. (Normative
requirement not frozen so far). NTPC has already signed a Model Fuel
supply agreement with Coal India Limited
for 90% coal requirement for existingstations of NTPC. The process of signingof FSAs for individual stations is inprogress.
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IMPORT(FIG INMillion Tonnes)
.
2005-06 2006-07 2007-08 2008-09
3.1 2.3 2.7 5.4
NTPC is partially mitigating its domestic coal shortage for existing stations by
importing coal through third parties and the percentage of import coal is
Increasing every year. In the current Financial yearNTPC planned to import 12.5
Million Tonnes
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Coal security-Augmentation of
unloading
NTPC has already started Augmentation
of unloading infrastructure like Wagon
Tipplers at pithead stations for absorbingmore IR rakes.
This would enable the stations to absorbmore coal through railway system.
ap ve n ng oc s
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ap ve n ng oc s
Backward IntegrationCoal Mining
Projects
Basket source
for
Command area Mine
CapMT
MOC Schl.
forProd.
Est.
Minelife
Pakri Barwadih
(critical)
Shortfall of
Lara and
Darlipalli
CCL-N
Karanpura area
15 2009-10 38
Chatti-Bariatu Barh-II-1600
MW/TandaExpn-1320MW
CCL-N
Karanpura area
7 2010-11 25
Kerandari do 6 2011-12 30
Dulanga Darlipalli-3200
MW
MCL-Ib Valley 7 2011-12 30
Talaipalli Lara-4000MW SECL-Mand
Raigarh
15 2011-12 30
Brahmini (Incl
Chichro
Patsimal)
(critical)
Farakka &
Kahalgaon
ECL 20 - 25
Chatti BariatuSouth
Darlipalli-3200 CCL-NKaranpura area
Production from Captive mines
not likely to commence in the
near future
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ACQUISITIONOF COAL BLOCKSABROAD
1. Participate in acquisition of coal blocks inprospective countries like Indonesia,Mozambique, Australia.
2. Leverage government support for tie up with
interested host country for expeditiousacquisition and development of mines anddevelopment of transportation logistics at the
exporting country.
This could be a long term Fuel securitymeasure and shall also help to partiallyoffset the volatility of coal prices in the
international market.
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DEDICATED RAILWAY FREIGHT
CORRIDOR
Has potential to meet long term Requirement.
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Mitigating Coal Shortage The Way Forward
Stepping up domestic coal production by allotting blocksto central and state public sector units and for captivemines to notified end users
Coal Import needs creation of necessary infrastructure.Will also put pressure on domestic coal industry to beefficient. NTPC has imported about 5.43 Mt of coal in2008-09 and is targeting to import more than 12.5 Mtof imported coal during 2009-10.
Amendment in Coal Mines Act to facilitate (a) private
participation in coal mining for purposes other than thosespecified and (b) offering of future coal blocks topotential entrepreneurs.
Technology for economic exploitation of coal lying at
greater depths
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MAJOR CONSTRAINTS IN IMPORT
Two major constraints in the import of coal
apart from Supply constraints in the
international coal market are:
1. Port infrastructure
2. Railway infrastructure
.
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AREASOF CONCERN As per indications, the port development
projects/plans would fall short of required capacity
addition to handle thermal coal imports of 100+MMTPA.
These projects are not mapped and positionedagainst Geographical demand centres. Most portdevelopment projects are along the east coast of Indiaand very few on the west coast
No visible plan of Indian Railways in place to cater tothe excess cargo to be handled by these portsexcept the dedicated freight corridor which in all
likelihood would not come before 2017.Plans to expand the railway network to connect theseports to inland destinations do not also seem to be inplace.
Source: CII
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Fuel Security: Thinking beyond
For a utility as large as NTPC, it is imperativethat we align ourselves completely with the
fuel business in line with the Vision of
becoming a fully integrated company by
2017.
Take fuel as a business.
Enter partial/ full Coal value chain.
Formation of a new subsidiary to handle fuel
business with complete autonomy to source
fuel.
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Thank You