MCL Clarifies On Coal Shortage; Says NALCO Should Look At Other Transportation Modes To Build Up Stocks

Sambalpur: Mahanadi Coalfields Limited (MCL) has sufficient coal stock of 16.5 million tonne for dispatch to meet the current requirement of its consumers. The company has further augmented production activities to ensure that adequate dry fuel is available in the country.

The company, which had registered a record growth of 14% in production and 21% in despatch of coal during 2021-22 financial year, has been successful in bridging the demand-supply gap of dry fuel in the country, MCL stated in a release on Thursday.

The company’s release was in response to news that National Aluminium Company Limited (NALCO) is facing acute shortage of coal, particularly at its Angul plant.

The company clarified that against a firm linkage of 47.16 lakh tonne and a bridge linkage of around 9 lakh tonne per annum for Angul plant, which translates to around 15,500 tonne per day, NALCO, Angul was supplied 53.9 lakh tonne coal from MCL during the FY 2022, against FSA, Bridge Linkage and E-Auction combined.

NALCO at Angul primarily takes coal from MCL through a dedicated MGR (Merry-Go-Round) system at Bharatpur area in Talcher coalfields. Additionally, NALCO also has options to lift coal through rail and road mode as well as road-cum-MGR mode to supplement their supplies.

The MGR system dedicated to NALCO, Angul, recorded an average despatch of only 5,900 a day during last fiscal. Considering the operational data of MGR system, which is 30-year-old and reports frequent breakdowns, MCL has proposed to take up for a major overhaul of MGR system. The overhaul has been proposed to improve despatch if NALCO agrees for discontinuation of supplies from this system during the period of renovation and adopts other mode of transportation, as Angul plant is located at a distance of 20 km from MCL mines.

Being a pithead plant, NALCO at Angul should look for options of lifting coal through MGR and road mode, the release stated. However, in FY 2021-22, only three lakh tonne in Bridge Linkage was booked in road mode leading to shortfall. Had NALCO booked via road mode the remaining six lakh tonne in Bridge Linkage and the shortfall quantity in FSA, sufficient coal stock would have been available at its Angul plant, the release mentioned.

It is to reiterate that all the non-power sector customers are being allocated coal up to the minimum committed level as per FSA (trigger level). However, MCL is offering 100% Monthly Agreed Quantity (MAQ) of coal to NALCO under Bridge Linkage, as a special measure to specifically support NALCO.

MCL stated that NALCO should think innovatively to improve lifting of coal from MCL, in view of rising demand at national level and constraints in getting rakes beyond a certain level.

During 2021-22, lifting of coal through road mode by NALCO Angul plant had dropped down to a daily average of less than 700 tonne while it had lifted up to 9,000 tonne in a day on earlier occasions.

Besides, MCL has also offered NALCO to lift coal through MGR wharfwall siding, which is lying unutilized and can help in transportation of 3,000 tonne coal per day, the release added.

In view of low stock at many power houses and considering the availability of rakes, despatches via rail mode have been prioritized for power houses, especially the distant ones, where supply of coal through alternate modes is not feasible. Therefore, supplementing the shortfall in MGR lifting with rail mode should be avoided. However, MCL is ready to load rakes for NALCO, Angul as and when placed at sidings, it stated.

On an average, one rake per day was loaded for Angul plant in March 2022, to supplement the MGR despatch.

NALCO’s Damanjodi plant, located 700 kms from MCL mines, has a linkage of 10.2 lakh tonne, and primarily relies on railway rakes for supply. Due to our sustained effort and persuasion, an average of one rake per day could be loaded from MCL during February and March 2022, thereby meeting the requirement of the plant and achieving more than 100% supply  materialisation and liquidation of arrear.

Moreover, during FY 21-22, the total supply to Damanjodi plant was 11.3 lakh tonne in FSA and e- auction combined. However, the supply materialisation could have further augmented, had NALCO continued lifting some quantity under Road-cum-Rail (RCR) mode regularly. MCL has suggested NALCO to arrange for lifting coal via RCR for Damanjodi plant to build stock considering the increased energy demand, MCL stated in the release.