Government wants CIL to liquidate 10MT of stocks by end of October to address demand surge

15-Oct-2018

The government has admonished Coal India’s brass for poor project management, long delays in tendering, leniency with contractors and other issues that have starved thermal power plants of fuel and warned the company’s nonperformers that it can take stern action.

The central government wants Coal India to liquidate 10 million tonnes of pit head stocks from its existing 21 million tonnes by end of October to take care of increased demand during festival season.

“Contracts management and monitoring systems, especially for big infrastructure projects like coal handling plants and washeries are very poor,” the coal ministry said in a letter to Coal India.

“There are inordinate delays in floating tenders after obtaining approval of competent authority, completion of tender process and issue of work orders, monitoring timely completion of works as per terms and conditions of work order, taking punitive action against defaulting contractors, leading  to inordinate delays in completion of many important projects, thereby allowing valuable investment to remain unutilised or under-utilised.”

It has asked the company’s top brass to take prompt action.

“It appears the senior offices are not reviewing these matters on regular basis and not taking timely remedial measures as required… This calls for urgent action on the part of all CMDs, functional directors, and general managers,” said coal secretary Inder Jit Singh in a letter to Coal India.

A senior Coal India executive said this letter is part of regular correspondence from the ministry, asking Coal India to achieve targeted performance parameters.

The secretary has asked chairmen of Coal India and its subsidiaries to take immediate steps for achieving additional production capacity at mines during remaining part of current financial as well as beginning of next fiscal by obtaining necessary clearances in a time bound manner and resolving issues related to land etc.

The ministry is concerned that despite repeated instructions and reviews and even after the end of rainy season, coal production and supplies did not pick up to the extent necessary for achieving production and offtake target of 652.25 million tonnes and 681.20 million tonnes respectively. Progress of old stocks liquidation and over burden removal is also very slow and coal stocks at power plants are decreasing and number of critical and super critical plants are increasing.

Singh has also asked top bosses to frame a definite plan for producing one billion tonnes of coal per annum without any further delay.

“With a view to reduce our import dependence, supply of domestic coal has to increase immediately.

This calls for ramping up of production with immediate effect so that production is increased to two million tonnes a day,” Singh said in the letter.

Source: THE ECONOMIC TIMES