The Hindu Business Line : Cement manufacturers call for new long-term coal linkages

The association has also urged allowing a five per cent increase of contacted quantity to meet the additional coal requirements of the cement sector.

Phalguna Jandhyala

New Delhi, Oct. 5 The Cement Manufacturers Association (CMA) has called for the need to sanction fresh long-term coal linkages for the new capacities. The association, at the recent meeting of the Standing Linkage Committee (SLC) for cement plants for the third quarter, has also requested linkages for enhanced capacities that have already come up.

Fuel supply agreements

“The CMA representatives also raised the issue that some of the cement companies have approached the coal companies concerned for the conclusion of fuel supply agreements (FSAs). However, as the validity period for the conclusion of FSA approved by the Government has expired, coal companies were unwilling to execute the same,” a member of CMA told Business Line.

The association also wanted the Committee to ensure that programmed quantity, which is sanctioned by the SLC and also provided in the FSA, is moved fully.

“The difference between the notional rake quantity of 3,770 tonnes and the actual billed quantity of that rake could accumulate over a period of time and this quantity could then be moved as additional rakes to the buyer. Further, South Eastern Coalfields Ltd is asking for cash deposit to cover that portion of the quantity of coal, which is required to complete a full rake and this demand is not correct,” the member said.

The association has also urged allowing a five per cent increase of contacted quantity to meet the additional coal requirements of the cement sector.

e-booking

“We also want the present procedure that the present system of e-booking which does not allow cement industry to access coal to be looked into. The e-booking system should have a provision of supply of coal to actual users,” the member added.

Provisions of FSA

Meanwhile, Coal India Ltd officials have said that at the moment there were no provisions in the FSA indicating procedures to be followed on carry forward of left over quantity as a result of difference between notional rake quantity and actual billed quantity. “We would look into this issue and any amendments required in the FSA conditions would be considered by CIL and other coal companies,” the official said.

Output hit

On the other hand, Ministry officials have said that during the second quarter, due to constraints such as monsoon and the non-availability of explosives, production of coal was affected.

“The Ministry hopes that during the third quarter, coal companies will be able to meet production targets and satisfactory materialisation of supplies to cement sector will be achieved,” the Ministry official said.

The SLC also approved the linkages for the third quarter of the current fiscal.

While CIL will be supplying 2,75,082 tonnes per month, Singareni Collieries Company Ltd will be providing 1,09,260 tonnes per month.