Coal India Ltd (CIL) has refrained from entering into new contracts for coal imports on behalf of State Gencos and independent power producers, as the one-year validity of medium-term contracts ended on June 30.

In response to a government directive last year to bolster coal stocks at indigenous coal-based power plants, Coal India had initiated two international competitive bidding e-tenders, each for 3 million tonnes (MTs) of coal imports. The bids pertained to 5,000 GAR (gross as received) quality thermal grade coal. These medium-term tenders encompassed a total of 6 MTs of coal, with the option to increase the bid quantity by 100% to 12 MTs.

A company official explained that since the order placement tenure was for one year from July '22 to June '23, and with no fresh government directive, the company has not issued any new tenders or contracts. The minimum indent quantity for each tender was 50,000 tonnes per order.

The tenders were not indent-based; they were designed to maintain a ready stock of coal for immediate availability and future use. Coal India viewed this as a proactive measure to secure future supplies and maintain a prepared vendor. When state generation companies and independent power plants placed orders based on their requirements, the coal would be shipped into the country and delivered within 30 days at the designated power plant location.

For the 6 MTs of coal sought through competitive bids, nine destination ports were designated for coal discharge, with 3 MTs each on the eastern and western coasts of the country. The estimated value of the work was around ₹3,850 crores for each 3 MTs tranche.

These two tenders closely followed a short-term e-tender of similar nature that Coal India issued on June 8 the previous year. However, that particular tender was for a limited period and quantity.

Meanwhile, Coal India's production remained robust in July, with a growth of 13.4% compared to the same month last year, totaling 53.6 MTs. This was an increase of 6.3 MTs from the 47.3 MTs produced in July '22. The company's production surged to 229.1 MTs by July '23 in the current financial year. Coal supplies also witnessed a strong growth of 7.2%, reaching 58.3 MTs in July '23 compared to 54.4 MTs in July '22.

From April to July '23, total supplies to all sectors reached 244.5 MTs, indicating a growth of 5.7% over the same period in the previous fiscal year, which had a high base of 231.2 MTs. The supplies recorded a 13.3 MTs expansion on a year-on-year basis during the first four months of the current financial year.