NTPC close to awarding $4b coal mine contract
DELHI: NTPC Ltd., India's largest power-generation company, is close to awarding a contract worth $4 billion for starting its first coal mine in the country, according to three people with knowledge of the decision.
An auction to choose an operator for the Pakri Barwadih mine in the eastern state of Jharkhand has concluded and a decision will be taken at a board meeting this week, said the people. A venture of Thriveni Earthmovers Pvt. and Sainik Mining won the auction, quoting Rs.26,000 crore ($4 billion) for developing and running the mine over 25 years, they said. Having its own supply will help the state-run utility save on more expensive imports of coal, the fuel that fires 75% of its 45 gigawatt capacity. Since NTPC has to pass on the benefits of lower fuel costs to customers, the move may boost sales to state electricity retailers that have been cutting back on purchases because of a lack of funds.
Salem, India-based Thriveni and New Delhi-based consortium partner Sainik Mining bid the lowest in the electronic auction, Thriveni Executive Director B. Karthikeyan said, without giving further details. Sainik Mining Director R.S. Sindhu didn't provide a comment after three requests by phone to his office. NTPC declined to comment. Production from Pakri Barwadih should begin early in the year starting 1 April, two of the people said. The Pakri Barwadih mine is expected to yield NTPC about 310 million metric tonnes of coal over 25 years.