Coal India Ltd has announced the commencement of Tranche-V of coal linkages for non-regulated sector, starting with auction for Steel sub-sector.
The auction based on competitive bidding, has been envisaged as a transparent system of long term coal supplies for end-user plants, having FSA (Fuel Supply Agreement) tenure of 5 years which can be further extended by another 5 years on mutual agreement.
However, for the sake of increasing coal availability for Steel sector, the FSA tenure of Steel (coking) has been changed to 10 years (mutually extendable by 5 years) from 4th tranche onwards.
The process of registration on MSTC website has started from 9 Sep’19, while the auction for Steel sector is scheduled on 16 Oct’19.
Auction of coal for Sponge Iron, Cement, CPP, ‘Others (non-coking)’, and ‘Others (coking)’ sub-sectors, are likely to be followed after the conclusion of auction for Steel sub-sector.
The previous four tranches of the auction have witnessed 78.36 MnT of annual coal linkages booked at an average premium of 20.26% over non-power notified price. In fact, the highest coal quantity of 33.18 MnT was sold in the recent fourth tranche of auction, garnering 32.68% premium over the notified price.
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