Coal India’s November output hit by cyclone, festivals

Chairman S. Narsing Rao says October was strong, but Nilam and festivals affected output in November
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First Published: Mon, Nov 19 2012. 01 16 PM IST
Coal India’s production from 1 April to 15 October was 208.3 mt, a growth of 9% over the previous year, Rao had said at the end of October. Photo: Getty images
Coal India’s production from 1 April to 15 October was 208.3 mt, a growth of 9% over the previous year, Rao had said at the end of October. Photo: Getty images
Updated: Mon, Nov 19 2012. 10 19 PM IST
New Delhi: Coal India Ltd’s production so far in November has been affected by cyclone Nilam that struck India’s east coast and holidays on account of festivals, its chairman said on Monday.
It’s bad news for power producers, already hit by low availability of coal, experts said.
“Actually, October was extremely good, but November was damp,” S. Narsing Rao, chairman of Coal India, told reporters. “The first eight-nine days (of November), the Nilam cyclone had a devastating effect and there were festivals, et cetera.”
Rao did not say by how much production would dip in the October-December quarter, but said, “We are not as comfortable as we would have liked to be.”
Cyclone Nilam hit Tamil Nadu on 31 October and also affected Andhra Pradesh, claiming 28 lives, according to media reports. Diwali festival was celebrated on 13 November.
India’s power generation by coal-based plants in April to September achieved a growth of 13.81% from the same period last year, according to Central Electricity Authority. Its report said in September, thermal power stations received 30.6 million tonnes (mt) of coal against the demand of 34.4 mt.
An analyst said it was too soon to say if the indication of lower output in the current quarter could bring down the full year’s production.
“This may be a short-term trend,” said Girish Shirodkar, a partner and managing director of management consultant Strategic Decisions Group AsiaPac. “A lot of power plants are anyway sitting on low supplies of coal. Any further deficit in supply could affect generation and there could be load shedding.” 
Shirodkar said the most vulnerable plants could be those of NTPC Ltd’s, India’s largest power generator, and the state electricity boards. Rao said the sales target for the three months to 31 December is 124 mt.
Coal India’s production from 1 April to 15 October was 208.3 mt, a growth of 9% over the previous year, Rao had said at the end of October.
At that time, he said the company was set to surpass the 2012-13 production target of 464 mt.
An executive from a power trading company said he was sceptical about Coal India’s claim that the natural calamity and holidays could have hurt productivity of the coal miner.
“When a company does not want to supply coal, it says such things,” said the executive, declining to be named. “The cyclone mostly affected the coast, and festivals come every year, so the company should have planned for it.”
Power companies have been at loggerheads with Coal India, complaining about low supplies. NTPC has complained about Coal India supplying lower grade of coal at high prices. Power companies also want Coal India to import coal to fill the gap in supply and average out the prices according to a proposal termed price-pooling.
Separately, Rao said Coal India had started exploration at its coalfield in Africa about 10 days ago, though it will still be some years from actual production.
Coal India shares ended 0.14% at Rs.351.45 on BSE Ltd, while the benchmark Sensex gained 0.16% to 18,339 points.
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First Published: Mon, Nov 19 2012. 01 16 PM IST
More Topics: Coal India | output | Nilam | festivals |
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