Post transfer of Singareni Collieries to Telangana, Andhra Pradesh now looks at own coal mining company

HYDERABAD: With the ownership of India’s second largest state-owned coal firm Singareni Collieries transferred to Telangana under state bifurcation, Andhra Pradesh is now looking at floating own coal mining company to explore and mine coal reserves towards meeting its energy needs.
Singareni Collieries currently has over 10,000 million tonne (mt) of proven coal reserves and little over 1,700 mt of reserves feasible for mining in the Godavari Valley coal field. The state-owned coal producer, which is now jointly owned by the Telangana government and the central government in 51:49 ratio, produced 50.47 mt of coal in 2013-14.

Post bifurcation, Andhra Pradesh has over 10,000 MW of installed power generation capacity, comprising 50,093 MW of thermal, 3,829 MW of hydro and 1,117 of renewable energy. The state depends on Singareni and coal mines of Odisha for its thermal units. Owing to shortage of coal supplies to most of its power projects, the state is operating its thermal units at less than half of capacity utilisation, leading to acute energy deficit. Added to it, at least 10,000 MW of proposed coal-fired power projects could not take off in the absence of assured coal supplies and steep hike in global coal prices.

The move to have own coal mining company also comes close on the heels of discovery of huge coal reserves near Chintalapudi in West Godavari district of Andhra Pradesh by the Geological Survey of India last week. “The findings by Geological Survey of India indicate more than 1,000 mt of coal deposits in West Godavari district, which should support thousands of megawatt of thermal power projects for decades,” said Cherukuri Kutumba Rao, vice-chairman of AP Planning Commission.

He told ET that “AP government will seek the Centre’s approvals for floating own coal mining company, preparations for which are currently at a preliminary stage. We will look into deciding on the timeframes for mining once we receive the final report from Geological Survey of India.”

Further, the mineral development corporation of the state is looking at expediting coal mining operations at two coal blocks allotted to it in Odisha and a block in Madhya Pradesh.

“AP, with vast deficit budget, absence of capital city, highly inadequate infrastructure and lack of industries, will find it difficult to attract large industrial investments if it cannot add significant power generation capacities at the earliest,” said a senior cabinet minister, who did not wish to be named.