Coal India to discuss supply to power plants via MoU route

New Delhi: Coal India (CIL) will seek the approval of its board tomorrow for providing the fuel for another month, under the MoU route, to power plants commissioned in the 2012-13 fiscal.

The earlier deadline for supply of coal through MoU route expired on December 31, 2012, according to a CIL official. Another one month is sought as power companies, including NTPC, are yet to sign fuel supply pacts with CIL, he added.

"In the meeting, likely tomorrow, CIL will seek the approval of its board for supplying for another one month's coal under the MoU route to those power plants commissioned during 2012-13," a Coal India official said.

[caption id="attachment_589348" align="alignleft" width="380"] The earlier deadline for supply of coal through MoU route expired on December 31, 2012. Reuters[/caption]

"More time is sought as the fuel supply pacts are yet to be completely signed," the official said. An MoU is not a legally binding document and now that route would be used till the issues holding up the Fuel Supply Agreement (FSA) are resolved.

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The government had in May directed coal companies to supply fuel to power plants that have been commissioned in 2012 through the MoU route till FSA issues are resolved.

"The Ministry of Coal has issued a directive to coal companies to supply coal to power plants commissioned till March 31, 2012 as well as those to be commissioned during 2012-13 through the MOU route as the FSAs are getting delayed," the Power Ministry had said.

"With this directive, the commissioned plants would be able to generate power without facing disruption of coal supply," it had said. Earlier this month, the Coal Ministry had said that 35 power firms have so far entered into fuel supply pacts with Coal India amid the government stating that most of the issues relating to FSAs have been resolved.

The statement followed the government announcing last month that power companies are likely to ink fuel supply pacts with CIL in a month's time. The ministry also expressed hope that the remaining 79 fuel supply pacts would be signed shortly. "The balance (FSAs) are expected to be completed shortly," the statement said.

PTI