North-Based Cement Firms May Appeal Supreme Court’s Ban On Petcoke

20 November 2017

North-based cement companies including Shree Cement Ltd. will appeal the the Supreme Court’s ban on use of petcoke by industries in Haryana, Rajasthan and Uttar Pradesh.

The ban will affect its profitability in the short term, HM Bangur, managing director of Shree Cement told BloombergQuint. The industry will represent its case in the Supreme Court given that “the company has the required technology to use petcoke without causing any air pollution”, he added.

The court had on October 24 banned the use of pet coke and furnace oil in these three states from Nov. 1 while keeping in view the pollution levels in Delhi-NCR and noting that these states had no objection to it, wire agency PTI said in a report. The use of petcoke and furnace oil is already prohibited in Delhi. The Supreme Court is now scheduled to hear the case next to Dec. 4.

According to a recent India Ratings report, petcoke usage is the highest amongst all the northern players like Shree Cement, JK Lakshmi Cement Ltd. and Mangalam Cement Ltd. Shree Cement uses 100 percent petcoke for all its cement and power plants.

Power and fuel costs may go up by 10-15 percent if the petcoke ban comes through, said Murtuza Arsiwala of Kotak Securities told BloombergQuint in an interview ahead of the apex court’s order. The impact will be felt primarily by the northern players since these companies have a higher dependence on petcoke compared to pan India players, he added.

The Supreme Court today also directed states and Union territories to consider prohibiting the use of pet coke and furnace oil by industries, saying it causes pollution not only for the National Capital Region but the entire nation.

Source: BloombergQuint