Lok Sabha Question No. 217 (UNSTARRED), answered on 2018-07-18
Subject: Swapping of Coal
Ministry: COAL
Asked by: JAYSHREEBEN  PATEL

## GOVERNMENT OF INDIA

## MINISTRY OF COAL LOK SABHA UNSTARRED QUESTION NO.217

## TO BE ANSWERED ON 18.07.2018

## Swapping of Coal

## 217.   SHRIMATI JAYSHREEBEN PATEL:

Will the Minister of COAL be pleased to state:

- (a) whether  the  Government  of  India  is  aware  about  the  agreement  of swapping  of  coal  with  Gujarat  Government/Gujarat  State  Electricity Corporation Ltd. (GSECL) with NTPC to reduce the burden of transportation cost of fuel;
- (b) if  so,  whether  the  Government  of  India  /  Western  Coalfields  Limited (WCL) would supply the coal to GSECL at notified rated only and not on cost plus, as the same shall not be viable to GSECL as cost will increase;
- (c) if  so, the time-frame to allocate more coal from WCL to GSECL to cater to its requirement at notified rates only;
- (d) whether transfer/swapping will be based on heating value terms; and
- (e) if  so,  whether  the  WCL  will  allow  the  third  party  to  do  the  sampling and analysis at loading?

## ANSWER

## MINISTER OF RAILWAYS, COAL, FINANCE AND CORPORATE AFFAIRS

## (SHRI PIYUSH GOYAL)

(a)  to  (c)  :  Yes,  Madam.  In  line  with  the  recommendation  of  the  Standing Linkage Committee (Long Term) dated 11.08.2014, an agreement for swapping of  coal  linkage  was  signed  between  Gujarat  State  Electricity    Corporation Limited (GSECL) and NTPC in November, 2014 for swapping of 1.0 MT of coal. As per the agreed terms, GSECL offered its South Eastern Coalfields Limited (SECL) linked coal to NTPC Korba STPS and the coal imported by NTPC was to be  supplied  to  GSECL  plant  to  avoid  criss-cross  movement  of  domestic  and imported  coal.  This  led  to  a  potential  annual  savings  of  Rs.  458  crore  to

GSECL. The swapping arrangement was continued till import of coal by NTPC upto 2016-17. The  Inter-Ministerial  Task  Force  (IMTF)  constituted  in  June,  2014  for  a comprehensive review of existing coal sources and also to see the feasibility for rationalization  of  these  sources  with  a  view  to  optimize  transportation  cost recommended for  shifting  of  1.2  MTPA  coal  linkage  of  GSECL  from  SECL  to Western  Coalfields  Limited  (WCL),  leading  to  annual  potential  savings  in transportation  cost  of  about  Rs.  100  crore  to  GSECL.  Though  Coal  India Limited (CIL) had advised WCL to execute Fuel Supply Agreement (FSA) for 1.2 MT of coal with GSECL, but due to non-availability of sufficient coal at notified price,  WCL  is  supplying  coal  to  GSECL  at  notified  price  under  MoU  on  best effort basis. Meanwhile, WCL has offered to sign FSA with coal mix of notified and  cost-plus  basis.  Till  such  time,  supply  of  coal  from  WCL  on  best  effort basis is continued. (d):   The transfer of coal is not based on heat value term. Coal  supplied  to  GSECL  from  WCL  is  covered  under  Third  Party Sampling  and  analysis  at  loading  point  for  which  a  Tripartite  Agreement between  WCL,  GSECL  &  CIMFR  (Third  Party  Agency)  has  already  been

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(e): concluded.