Talwandi Sabo Power Ltd (TSPL), a Vedanta Group company, has awarded a tender for 0.30 mt of Indonesian thermal coal to two traders for delivery in the first quarter.
Of the total, around 0.21 mt has gone to Mohit Minerals, the lowest bidder, and the remaining around 0.09 mt to Comsol Energy, part of Dubai-based Iman Resources after it subsequently matched Mohit Minerals’ bid of around INR1.78/kcal or $0.025/kcal on a plant delivered basis.
That works out to be $127/t delivered to plant, basis 5,000 kc GAR. It’s understood the final price includes rail transport costs of around $36/t to ship the coal some 1,200 km from port to plant, as well as various Indian taxes and handling charges.
There is an option to supply 4,200 kc GAR material as well, providing prices do not exceed INR1.78/kcal or $0.025/kcal. Thus, the price would reduce to $106.80/t, basis 4,200 kc GAR.
IHS Markit assessed the price of 4,200 kc GAR coal at $39.96/t CFR west coast on 28 December and that of 5,000 kc GAR was $55.24/t CFR west coast.
TSPL issued the tender on 12 December for its 1.98 GW plant in the Mansa area of Punjab in northern India. Bids were invited on a delivered to plant basis through any west coast ports.
It requested delivery between January and March 2019 and specified a range of qualities including 4,200 kc GAR, 5,000 kc GAR, 5,800 kc GAR, 6,300 kc GAR. Vols are between 20-35% and sulphur of 0.5%.
TSPL previously floated a tender in early October, seeking 0.15 mt of thermal coal, which went to Mohit Minerals. The generator had issued two other tenders in 2018 – 0.30 mt in May and 0.24 mt in March.
TSPL uses both domestic and imported coal and this new tender is a part of its regular procurement programme.
Looking ahead, TSPL may launch another tender soon in order to supplement supplies from domestic sources, which are being prioritised for state-owned power plants.
TSPL imported 0.83 mt of coal in Indian financial year 2017-18, up 76% from 0.47 mt in 2016-17. Its imports in the first eight months (April-November) of 2018-19 stood at 0.66 mt, up 20% from 0.50 mt in the same period of 2017-18.