New Delhi: India's largest private sector power producer Tata Power Co Ltd is looking for coal mines in South Africa and Indonesia to meet the shortage of fuel supply for its power plants, media reports said, citing Executive Director (Operations) S Padmanabhan.
"Given the demand for the fuel for our Power plants and shortage of domestically produced coal, we have to depend on imports. We are looking at Indonesia and South Africa for acquiring coal mines," he told the the Press Trust of India.
Padmanabhan, however, did not give any details about the amount to be spent on these acquisitions and any time-line for such deals. But he said that the it would not be an outright purchase and the company is mulling acquiring stakes in already operating mines.
Notably, several power companies in India, including state-run NTPC Ltd, have decided to reduce operations and cut capacity due to shortage of fuel supply.
Shortage of coal in India is estimated to widen to 192 million metric tonnes (MT) in the current fiscal through March 2013, from about 85 MT two years ago, due to production fall at Coal India Ltd, the country's largest coal producer that meets 80% of the domestic demand.
Presently, the private sector power major sources coal from four mines in Indonesia and two in Australia and depends on group firm Tata Steel Ltd and state-run Coal India Ltd for domestic supplies.
In four mines of Indonesia, Tata Power holds 30% stake each in two of them, with an offtake of about 40 million tonnes per annum (MTPA) from them.
"However, our current offtake from these mines is only 3 million tonne, while we can ship as much as 20 mt from each of them. But we don't do that since that will push up cost of power too high," Padmanabhan said.
The power major uses the imported coal for its 4,000-megawatt (MW) ultra mega power project (UMPP) in Mundra, Gujarat, the rights for which it won in the year 2007 in a government bidding, and for 1,580 MW plant in Trombay near Mumbai.
The company had commissioned the first unit of 800 MW of the Mundra UMPP earlier March and expects second unit of an equal capacity by August this year.
Padmanabhan further said that Tata Power, which had installed capacity of 5,299 MW as of March 2012, expects to to add 1,435 MW this fiscal that includes 800MW at Mundra's second unit; 525 MW from Maithon: and 100 MW from wind mills.
Tata Power is contemplating increasing its generation capacity to 26 gigawatt (GW) by 2020, from the current 5.2 GW, Managing Director Anil Sardana told the Wall Street Journal. Earlier, the company has planned to raise its total capacity to 25 GW by 2017.