* Coal imports account for 10 pct NTPC's annual fuel
* Expects 40 mln T coal from its own, licensed mines by 2017
* Sees 2016/17 coal needs at 200 mln T vs 164 mln T 2012/13
(Recasts, adds quotes, details)
By Malini Menon
NEW DELHI, Feb 8 (Reuters) - India's largest power producer,
NTPC, wants to reduce its coal imports from 10 percent
of its annual fuel requirement to keep production costs under
check, its chairman said.
The 40,000 megawatt thermal power producer has a coal
requirement of 164 million tonnes in the current fiscal year to
end-March and has already contracted to import 16.4 million
tonnes of coal, a third more than the 2011/12 fiscal year.
"Ten percent of all our requirement is now being imported,
but we would like to reduce it. It increases the costs. It
doesn't help the country," Arup Roy Choudhury, who is also the
managing director of the state-run utility, said in an interview
Imported coal costs almost 50 percent more than the
equivalent local coal supplied by state-run miner Coal India
Limited, which produces nearly 80 percent of the
domestic coal supply.
About 70 percent of power generated in India is from burning
Choudhury said his hopes of trimming imports hinge on the
availability of more domestic supplies in the next few years
from Coal India and private players as well as from the captive
coal blocks allocated to the utility.
"We are expecting Coal India to increase its production. We
are expecting other people (private producers) to come in," he
said, on the sidelines of the fifth India Energy Congress
conference in New Delhi.
"The (captive) blocks that we have will give out 40 million
tonnes by the end of (March) 2017. But by that time, our demand
requirement will be 200 million tonnes of coal. So we get still
only 20 percent of what we require from the mines that we have."
NTPC aims to increase its capacity to 51,052 MW by end-March
NTPC obtains the bulk of its coal through long-term fuel
supply agreements (FSAs) with Coal India. The utility has
delayed signing a new supply contract for 4,500 MW with the
miner, however, citing quality issues.
"There are certain issues which we are sorting out with Coal
India. Of 40,000 MW, only 4,500 MW is the new FSA. The rest are
working on the old FSA," Choudhury said.
India has about 118 billion tonnes of coal that could be
mined but manages to produce only about 600 million tonnes
annually, he said.
Coal India, the world's largest coal miner, is under
pressure from the government and power producers to ease fuel
shortages at home but has struggled for years to raise output
due to problems in obtaining environmental and regulatory
"In the last five years, the CAGR (compound annual growth
rate) of India's power sector has been close to 10 percent,
while that of Coal India has been minus 1," Choudhury told the
(editing by Jane Baird)