SECL says mines facing logistics constraints

Coal India subsidiary South Eastern Coalfields has been facing logistics constraints in transporting coal from pits to its railway sidings at Korba, Raigarh and Korea-Rewa fields, it said in a notice to its consumers.

This has prompted South Eastern Coalfields to stop supplying more than the trigger level for each of its customers including power houses and independent power producers during July or till further notice.

According to supply contracts signed by consumers, Coal India is obligated to supply a certain percentage of coal to its consumers failing which it has to pay penalty. This level is 75% for new power plants and 90% for old power plants. Non-power consumers also receive a certain percentage of their annual coal requirement.

This percentage in technical terms if referred to as ‘trigger-level’ because failing to supply this quantity triggers the penalty clause in the fuel supply agreement signed with the consumers.

However, South Eastern Coalfields has clarified that if consumers require more coal than the trigger level it can lift additional quantities by road either from the Korea-Rewa or the Raigarh mine fields.

Last month, South Eastern Coalfields had suspended supplies from its Korea-Rewa coalfields to independent power producers to make sure stocks at thermal stations with critical and super critical stocks are boosted.

The decision was taken due to limited loading capacity at its railway sidings in comparison to demand.