Indonesian coal to fuel India?s Nagarjuna power plant

Indonesian coal will fuel India’s Nagarjuna 1,015-MW power plant project that would be built in the state of Karnataka.

Praveer Sinha, COO of Nagarjuna Power Corp. Said in Coaltrans conference in Bali on Tuesday that the company has long-term coal supply contracts with PT.Adaro Indonesia ( 1.2MTPA), PT. Banpu Indonesia (0.5MTPA), Glencore (0.5MTPA) and Aadithya (0.5MTPA).

The power plant would require 3 million tones of coal per annum.

The contracts, he said, are tied on 12-year basis with option to extend for another two terms of four years each.

Supply would commence in the last quarter of 2009, he said.

Coal supply and freight prices are firm for certain period and beyond that prices are based on mutually agreed international indexation, he said.

The US$1 billion power plant is part of India’s so-called Mega Power Project and would entirely burn imported coal. The company has signed PPA to sell 90 percent of its power production to the state of Karnataka and 10 percent to the state of Punjab. (alex)