B SURENDER MOHAN, Chairman and Managing Director of Neyveli Lignite Corporation, speaks to Nikki Sachdev about the PSU’s future growth and plans to become a Maharatna Company
How was Neyveli Lignite Corporation’s performance in the last fiscal 2012-13?
It has been an exceptional year in terms of growth despite certain setbacks such as cyclone Neelam and labour strike in the first quarter of the financial year. NLC exceeded all its targets and registered higher growth in FY 12-13 as compared to the previous year’s performance. We also achieved the total overburden removal from all mines put together at 1674.97 LM3 which is the highest for any year since inception. We also had a significant growth of 5.8% over last year in power generation where total power generation from all thermal stations stood at 19901.79 MU. Total Lignite production from all mines put together at 261.97 LT and lignite production from Mine-II at 139.32 LT was achieved during the year of 2012-13.
What are the future expansion or growth plans of Neyveli Lignite Corporation?
Until recently NLC was pursuing a growth plan which was lignite centric but since more than 85% of the total reserves are deep seated and are not amenable to conventional mining and since technologies to tap these reserves are in only nascent stage, we are looking at diversifying our profile in the coal and coal based power generation. NLC in joint venture with TANGEDCO is setting up a 1000 MW coal based power project at Tuticorin in Tamil Nadu and has proposed to set up a 3x660MW coal based power project at Ghatampur in JV with UPRVUNL in Uttar Pradesh.
We have also applied for coal blocks to have a constant supply of coal. We are hopeful of positive outcome. In the current financial year, we plan to add 1500MW and by the end of the 13th Five Year Plan we look to have a total power generation of 11195MW. We will increase our Lignite production by six million tonnes this FY and we also plan on having another coal-based power plant in Tamil Nadu for 2000MW in the first phase and increase it to 4000MW in the second phase.
What are NLC’s plans in terms of increasing lignite excavation, greater power generation and increasing profitability?
While we are the leaders in lignite mining with three open cast lignite mines, along with specialised environment friendly technology, we will further consolidate our position in this field. As I have explained earlier, for sustained growth, NLC is now looking for power generation using alternate fuels mainly coal. That said, NLC will also continue to take up viable lignite based projects and keep expanding our lignite mining capacities. We expect to achieve lignite mining capacity addition of 2.25 MTPA and a power generating capacity addition of 5470 MW in the 13th Plan.
What are other prospective projects are in the pipeline?
We are looking at diversifying into the renewable energy sector. We have received offers for setting up a 50 MW wind power project in Tamil Nadu and a 10 MW solar power project in Neyveli which are under evaluation. Based on the requirement we will increase our generation capacity of wind and solar power to another 30 MW in solar and at least 200 MW in wind power.
Further, NLC will explore the possibility of new technologies such as upgrading of brown coal, underground coal gasification and lignite to liquid etc.
Are you planning to go international and acquire coal mines abroad?
Looking at the current scenario, it is extremely hard to meet coal demands from within the country. NLC plans a capacity addition programme for achieving a total power generating capacity of 11195MW by the end of 13th Year Plan. Out of this 5000MW requires import of coal for supplementing the indigenous coal supply. NLC’s coal requirement is expected to reach 10 MTPA when all the projects are implemented. Hence, in order to meet the coal requirement, NLC has issued an invitation for Expression Of Interest (EOI) in February this year to secure its thermal coal supplies by acquiring coal blocks abroad, or by entering in to long term coal supply agreement, or by forming joint ventures with Coal Mining Companies, or by acquiring equity stakes in Coal Mining Companies or by any other acceptable means. I hope NLC will have its own secured coal supply source abroad in the near future.
What major steps have you taken for environment management?
Being a mining firm, NLC always strives for improving the environmental performance in a consistent manner over and above the statutory requirements. The thrust areas in this regard continue to be land reclamation, afforestation, elimination of air and water pollution, water table management, rain water harvesting, oil and energy conservation. NLC would ever remain a green organisation encouraging ecologically viable practices to ensure bright future and best environment for the generations to come. NLC has gone for continuous mining system which is less environmentally damaging technology. The company has planted 18 million trees in Neyveli.
Please share your initiative for Corporate Social Responsibility.
Neyveli Lignite Corporation is dedicated to working for the betterment of the society since its inception and has been working in tandem with the local governing bodies to give back to the community in a better way. We have been working in the areas of health, education, transport, community building and sports facilities. We have also been running special skill development programmes for the both women and men from the surrounding villages so as to make them self employed or employment ready as it is difficult to hire everyone. We plan to spend `20-25 crore for CSR activities in the current financial year.
What initiatives are you taking to become a Maharatna Company and achieve greater heights?
We have just earned the status of Navratna company and we have sketched a roadmap to get to the next level. As the first step towards Maharatna status, NLC has formulated its growth plan for the next 10 years. NLC has plans to achieve lignite mining capacity addition of 6.0 MTPA and a power generating capacity addition of 2985 MW at the end of 12th Plan. NLC expects to achieve lignite mining capacity addition of 2.25 MTPA and a power generating capacity addition of 5470 MW at the end of 13th Plan. NLC will have a total lignite mining capacity of 38.85 MTPA and a total power generating capacity of 11195 MW at the end of 13th Plan. With the implementation of the above growth plan, NLC will be in a position to generate revenues and profits to qualify for consideration of award of Maharatna status.
How was Neyveli Lignite Corporation’s performance in the last fiscal 2012-13?
It has been an exceptional year in terms of growth despite certain setbacks such as cyclone Neelam and labour strike in the first quarter of the financial year. NLC exceeded all its targets and registered higher growth in FY 12-13 as compared to the previous year’s performance. We also achieved the total overburden removal from all mines put together at 1674.97 LM3 which is the highest for any year since inception. We also had a significant growth of 5.8% over last year in power generation where total power generation from all thermal stations stood at 19901.79 MU. Total Lignite production from all mines put together at 261.97 LT and lignite production from Mine-II at 139.32 LT was achieved during the year of 2012-13.
What are the future expansion or growth plans of Neyveli Lignite Corporation?
Until recently NLC was pursuing a growth plan which was lignite centric but since more than 85% of the total reserves are deep seated and are not amenable to conventional mining and since technologies to tap these reserves are in only nascent stage, we are looking at diversifying our profile in the coal and coal based power generation. NLC in joint venture with TANGEDCO is setting up a 1000 MW coal based power project at Tuticorin in Tamil Nadu and has proposed to set up a 3x660MW coal based power project at Ghatampur in JV with UPRVUNL in Uttar Pradesh.
We have also applied for coal blocks to have a constant supply of coal. We are hopeful of positive outcome. In the current financial year, we plan to add 1500MW and by the end of the 13th Five Year Plan we look to have a total power generation of 11195MW. We will increase our Lignite production by six million tonnes this FY and we also plan on having another coal-based power plant in Tamil Nadu for 2000MW in the first phase and increase it to 4000MW in the second phase.
What are NLC’s plans in terms of increasing lignite excavation, greater power generation and increasing profitability?
While we are the leaders in lignite mining with three open cast lignite mines, along with specialised environment friendly technology, we will further consolidate our position in this field. As I have explained earlier, for sustained growth, NLC is now looking for power generation using alternate fuels mainly coal. That said, NLC will also continue to take up viable lignite based projects and keep expanding our lignite mining capacities. We expect to achieve lignite mining capacity addition of 2.25 MTPA and a power generating capacity addition of 5470 MW in the 13th Plan.
What are other prospective projects are in the pipeline?
We are looking at diversifying into the renewable energy sector. We have received offers for setting up a 50 MW wind power project in Tamil Nadu and a 10 MW solar power project in Neyveli which are under evaluation. Based on the requirement we will increase our generation capacity of wind and solar power to another 30 MW in solar and at least 200 MW in wind power.
Further, NLC will explore the possibility of new technologies such as upgrading of brown coal, underground coal gasification and lignite to liquid etc.
Are you planning to go international and acquire coal mines abroad?
Looking at the current scenario, it is extremely hard to meet coal demands from within the country. NLC plans a capacity addition programme for achieving a total power generating capacity of 11195MW by the end of 13th Year Plan. Out of this 5000MW requires import of coal for supplementing the indigenous coal supply. NLC’s coal requirement is expected to reach 10 MTPA when all the projects are implemented. Hence, in order to meet the coal requirement, NLC has issued an invitation for Expression Of Interest (EOI) in February this year to secure its thermal coal supplies by acquiring coal blocks abroad, or by entering in to long term coal supply agreement, or by forming joint ventures with Coal Mining Companies, or by acquiring equity stakes in Coal Mining Companies or by any other acceptable means. I hope NLC will have its own secured coal supply source abroad in the near future.
What major steps have you taken for environment management?
Being a mining firm, NLC always strives for improving the environmental performance in a consistent manner over and above the statutory requirements. The thrust areas in this regard continue to be land reclamation, afforestation, elimination of air and water pollution, water table management, rain water harvesting, oil and energy conservation. NLC would ever remain a green organisation encouraging ecologically viable practices to ensure bright future and best environment for the generations to come. NLC has gone for continuous mining system which is less environmentally damaging technology. The company has planted 18 million trees in Neyveli.
Please share your initiative for Corporate Social Responsibility.
Neyveli Lignite Corporation is dedicated to working for the betterment of the society since its inception and has been working in tandem with the local governing bodies to give back to the community in a better way. We have been working in the areas of health, education, transport, community building and sports facilities. We have also been running special skill development programmes for the both women and men from the surrounding villages so as to make them self employed or employment ready as it is difficult to hire everyone. We plan to spend `20-25 crore for CSR activities in the current financial year.
What initiatives are you taking to become a Maharatna Company and achieve greater heights?
We have just earned the status of Navratna company and we have sketched a roadmap to get to the next level. As the first step towards Maharatna status, NLC has formulated its growth plan for the next 10 years. NLC has plans to achieve lignite mining capacity addition of 6.0 MTPA and a power generating capacity addition of 2985 MW at the end of 12th Plan. NLC expects to achieve lignite mining capacity addition of 2.25 MTPA and a power generating capacity addition of 5470 MW at the end of 13th Plan. NLC will have a total lignite mining capacity of 38.85 MTPA and a total power generating capacity of 11195 MW at the end of 13th Plan. With the implementation of the above growth plan, NLC will be in a position to generate revenues and profits to qualify for consideration of award of Maharatna status.
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