As per the national steel policy 2017, India has planned to build a competitive industry with a crude steel capacity of 300 mn t by 2030-31. The underlying objective requires an increase in domestic availability of washed coking coal so as to reduce import dependence to 50% by the time.
It is pertinent to note that the country possesses adequate reserves of limestone and iron ore, but as far as coking coal is concerned, about 70-80% of our requirement is being met from imports.
Indian coal of drift origin is characterized by high ash content with impurities disseminated in the coal bed, which requires proper processing in washeries to make it suitable for steel-making.
At present, 10% of the washed coal having reduced ash content of 18-19% is blended with 90% of imported coal having ash of 10-11% for coke manufacturing.
Reduction in coking coal imports can be carried out by raising the blending ratio, either by processing the coal in washeries or by using innovative techniques of steel-making. Looking at the various cost economics, the former seems a better option for utilizing the high ash coal.
Performance constraints of existing washeries:
In order to meet the desired goal, it is necessary to invest on new washeries as most of the existing ones have become quite old and these were designed to meet the washery grade of W-II and W-III having much less ash content.
Besides, the gradual shift from underground mining towards open-cast mining has further depleted reserve of premium grade coking coal, which already lack in volume comparable to non-coking coal.
Earlier, coking coal was only classified up to 35% and the coal beyond this ash percentage was termed as non-linked washery coal. However, upon intensive studies conducted by a technical committee constituted by Ministry of Coal, it was found that when these high ash coals are washed to lower the ash content, there was significant improvement noted in the coking properties.
Subsequently, reclassification of coking coal was done by a technical committee constituted by MOC, where two more grades have been added (W-V and W-VI), but processing them in existing washeries has resulted in lower efficiency.
Classification of various washery grades of coking coal
| Grades | Ash Content |
| Washery Grade I (W-I) | Exceeding 18% up to 21% |
| Washery Grade II (W-II) | Exceeding 21% up to 24% |
| Washery Grade III (W-III) | Exceeding 24% up to 28% |
| Washery Grade IV (W-IV) | Exceeding 28% up to 35% |
| Washery Grade V (W-V) | Exceeding 35% up to 42% |
| Washery Grade VI (W-VI) | Exceeding 42% up to 49% |
Source: CIL
Annual report submitted by CCL indicates that the yield of washed coal in coking coal washeries was 35.69% in FY ’19, whereas non-coking coal washeries were operating at a higher yield percentage of 97.96% during the period.
Moreover, it was found that washing of W-II and W-III grade of coking coal offers better financial viability for both the company and the customer in comparison to W-V and lower grades, as processing coal having high ash content leads to huge generation of middlings the marketability of which has to be taken into account.
Growth Opportunity:
With an increase in tenure of coking coal linkage for NRS customers to 30 years, there is likelihood that demand for washed coal would increase, which would in turn promote the development of new washeries.
At present, washeries at BCCL are being developed under BOM (Build Operate Maintain) concept, whereas CCL washeries are developed under BOO concept (Build Operate Own). The basic difference between them is that funding in case of the former is on account of subsidiary company, whereas in case of latter the bidder has to invest.
But in both cases, the freedom of selection of design has been given to the bidder so that the washery receives apt state of art technology.
In the 49th Annual General Meeting (AGM) of BCCL, CIL chairman Mr. Pramod Agrawal has instructed to complete the construction of new washeries and start them within the time bound, in order to keep a check on coking coal demand, so that import of coal can be reduced.
The chairman also highlighted that there is a need to complete the under-construction work of new washeries soon instead of focusing on the old ones.
Other measures to boost availability:
Apart from quality assurance in terms of washed coal, steps are to be taken towards normalizing the domestic coking coal prices as well for facilitating its consumption in domestic market.
Notably, the price revision being carried out have been cyclic in nature and always followed an upward movement. In contrast, global prices have witnessed up and down movement as per market conditions.
The coal ministry should offer the coking coal at an economy price so that it is of good value in use for the domestic players in order to reduce its imports given that the same cannot be adequately substituted.
Besides, to ensure long term availability of coking coal, road-map has been set by Ministry of Steel in conjunction with Ministry of Coal to facilitate exploration & exploitation of deep seated coking coal reserves. Also, efforts are in place to expeditiously implement Jharia Action Plan to improve the domestic availability of coking coal.
Leave a Reply