Jefferies says impact on NTPC likely after FY19
NTPC’s chequered execution history in past years has led to project delivery v/s announced plans driving re-rating. We visited its Pakri-Barwadih mines & were happy to see coal production has begun.
Experience here should see NTPC management picking up execution pace in other projects also. Currently, any returns from mining project investments in Pakri-Barwadih of R18 billion have not been factored in our earnings, with material impact likely FY19E onwards.
The mine is divided into three regions: 1) West Quarry, 2) East Quarry, and 3) North West Quarry. Progress has picked up sharply since Mine Developer and Operator (MDO) contractor Thriveni-Sainik JV has begun work in 2015 in the West Quarry.
NTPC from its 10 allocated coal mines has been discussing overall 105-110 mn tpa annual mining capacity. Strip ratio at Pakri-Barwadih (reserves 1.4 bnt) is high at 1:4.16 leading to a more gradual ramp-up in production over 3-5 years. Expected coal is G10 quality at 4100-4600 kcal. Chatti-Bariatu mine (0.5 bnt reserves) which is in the vicinity has a good strip ratio of 1:1, with management expecting a faster ramp-up and execution there post its current experience.
Management efforts are focused on raising profitability from internal efficiencies and plant-specific PLF improvements. Confidence remains in adding 3-5 GW in FY17E vs our expectation of 2 GW for standalone and 2.7 GW for the group.
http://www.financialexpress.com/industry/jefferies-says-impact-on-ntpc-likely-after-fy19/479926/
Govt to review status of 72 coal mines
The government over the next few days will examine the status of 72 coal blocks allocated either through allotment or auction route to companies like NTPC, JSW Steel, Hindalco and SAIL.
“...it has been been decided to hold a meeting under the Chairmanship of Joint Secretary and Nominated Authority, Ministry of Coal to review the status of 72 coal mines,” an official said.
The meeting is scheduled to be held on December 21 and December 26, the official added.
The status 35 coal blocks in the states of Jharkhand and Chhattisgarh allocated to the companies like Hindalco Industries, Bharat Aluminium Company Ltd, NTPC, Steel Authority of India Ltd (SAIL), JSW Steel will be reviewed on December 21, the official said.
While the status of remaining coal blocks in states like Madhya Pradesh, Maharashtra and Odisha allocated to companies like Reliance Cement, UltraTech Cementa and GMR Chhattisgarh Energy Ltd will be examined on December 26, the official added.
The government had informed Parliament last month that it has so far generated a revenue of approximately Rs 2,779 crore from the auction and allotment of 83 coal blocks.
The amount, it had said, is being transferred to the state governments where the coal mines are located.
Earlier, three rounds of mines auction were held after the Supreme Court in 2014 cancelled the allotment of 204 coal blocks.
http://www.thehindu.com/news/national/Govt-to-review-status-of-72-coal-mines/article16904844.ece
Jindal Steel lines up Rs 8,000 crore investment for its Odisha project
It also intends to lay a pipeline from the point of sourcing iron ore at Barbil in Keonjhar district to its Angul plant at a cost of Rs 800 crore
Navin Jindal-owned Jindal Steel and Power Ltd (JSPL) has lined up Rs 8,000 crore additional investment for its Odisha operations. The money will be spent on the addition of a blast furnace to take its Angul steel plant capacity to 6 million tonne, setting up of a cement plant, laying of the slurry pipeline to carry iron ore from mines to the steel plant and setting up of a pellet plant.
At present, JSPL has a two million tonne steel making facility at Angul through sponge iron route. To produce sponge iron, the company had set up a DRI plant based on coal gasification technology, the first of its kind in the country, that aimed to use locally available high ash coal for direct reduction of iron.
In fact, the company proposed to produce six million tonne steel at the location based on this coal gasification technology imported from Lurgi, South Africa.
However, the cancellation of Utkal 1B block allotted to the company following de-allocation of coal blocks by the Supreme Court in 2014, has forced it to go for process re-engineering to achieve the intended 6 million tonne steel capacity.
Instead of sponge iron route, it has decided to go for blast furnace route to scale up steel capacity to 6 million tonne. For the purpose, it is putting up a 4554 cu mtr blast furnace, claimed to be largest in the country with a capacity to produce 11,000 tonne of steel per day.
The blast furnace is expected to be ready for commissioning by the end of the current financial year. So also other associated facilities, such as coke oven to produce metallurgical coke and BoF (basic oxygen furnace) plants, the work of which are in progress. The capacity of steel melting shop is also being enhanced with the addition of a furnace of 3 million tonne capacity.
The total expenditure incurred on the all these new components required to raise the steel-making capacity at Angul from 2 million tonne to 6 million tonne is estimated at about Rs 6,000 crore.
Besides, the company also intends to lay a pipeline from the point of sourcing iron ore at Barbil in Keonjhar district to its Angul plant at a cost of Rs 800 crore. This will reduce the ore transportation cost substantially from Rs 800 per tonne to about Rs 200 per tonne, said Damodar Mittal, executive vice president, projects.
Taking advantage of this cheaper mode of ore transport, the company plans to set up a 4 million tonne per annum pellet plant at Angul with an investment of Rs 1,000 crore. The pellet plant can feed the existing DRI plant at the location and cut cost towards transportation of pellet from the company's Barbil plant to Angul, a distance of 280 Kms.
Similarly, using the slag produced from the blast furnace, the company proposes to set up a cement plant close to its steel mill for which an expenditure of Rs 200 crore has been earmarked.
http://www.business-standard.com/article/companies/jindal-steel-lines-up-rs-8-000-crore-investment-for-its-odisha-project-116121900899_1.html
NTPC inches up on inking MoU to set up power plant in Odisha
NTPC has signed a MoU with National Aluminium Company (NALCO) to set up a coal-based power project, having a production capacity of 2,400 MW, in Odisha’s Dhenkanal district. The energy produced at this unit will be used for meeting captive power requirement of NALCO for proposed greenfield Aluminium Smelter Plant at Kamakhya Nagar, Dhenkanal and expansion at Angul in Odisha.
http://khabarindia.in/energy/ntpc-inches-up-on-inking-mou-to-set-up-power-plant-in-odisha/
Vale opens largest iron ore mine in its history
Vale SA (NYSE:VALE) cut the ribbon on a massive iron ore mine in Brazil on Saturday – the largest in its history and what the world's largest iron ore producer says is the biggest ever in the mining industry.
While that is quite a claim, delving into the details of the $14.3-billion S11D complex shows that Vale is most likely correct.
Located in Canaã dos Carajás in Southeast Pará, the project – which includes the mine, processing plant, railroad and port logistics – has been 15 years in the making, starting with the first technical and feasibility studies in 2001. The Preliminary License (LP) was granted in June 2012 and, a year later, the Installation License (LI) was issued. On December 9, the Operation License (LO) was granted. Commercial operations start in January 2017 and the mine’s lifespan is expected to be 30 years.
S11D is also the largest private investment made in Brazil in a decade, which Vale says will boost the economies of the states of Pará and Maranhão. The company says its operations in Minas Gerais will also benefit from the project, since that ore will be blended with that extracted from S11D.
“For me, seeing the completion of S11D is much more than just witnessing a new landmark in the mining industry. More than an enterprise embodying the latest technology, low cost and high productivity, the S11D portrays Vale’s ability to make things happen,” Vale’s CEO, Murilo Ferreira, said in a press release describing the project in detail.
The completion of the mine is as much a feat of mining engineering/ construction as of transportation logistics.
Out of the US$14.3 billion invested in the project, $6.4 billion accounted for the mine and plant, and $ 7.9 billion in the construction of a 101-km-long railroad branch, and to expansions of the Carajás Railroad (EFC) and of the Ponta da Madeira Maritime Terminal in São Luís (MA).
S11D forms part of Vale's massive Carajás complex and will add another 90 million tonnes to the miner's capacity pushing it to between 400 and 450 million tonnes per year, by 2020.
The project was named after its location: it is on block D of the S11 ore body, which contains four blocks: A, B, C and D. According to Vale, S11’s mineral potential is 10 billion tons of iron ore, and blocks C and D together have reserves of 4.24 billion metric tons. The first geological surveys in the region occurred in the 1970’s.
Its full name is the Eliezer Batista S11D Complex, named after the company’s former president who was in charge of building the Tubarão Complex and assessing the feasibility of the Carajás mine.
http://www.mining.com/vale-opens-largest-iron-ore-mine-history/
US authorities set stricter rules for coal mining near streams
The US Interior Department published Monday a new rule that sets stricter conditions to coal miners with projects near streams and forests, one of several regulations the Obama administration seems to be rushing to release before President-elect Donald Trump takes office next month.
The Stream Protection Rule, which updates 33-year-old legislation with stronger requirements for responsible surface coal mining, will protect 6,000 miles of streams and 52,000 acres of forests over the next two decades, the department said.
Under the new rule, companies are not allowed to engage in mining practices that could pollute streams and drinking water sources. They also have to restore streams, and return mined areas to their original form.
“Regulations need to keep pace with modern mining practices, so we worked closely with many stakeholders to craft a plan that protects water quality, supports economic opportunities, safeguards our environment and makes coalfield communities more resilient for a diversified economic future,” Interior Secretary Sally Jewell said in the statement.
The new norm, however, is unlikely to materialize, as most rules require at least 60 days from the period their final versions are released before they go into effect. Besides, the rule is already part of Trump’s bucket list of environmental legislation he plans to revoke, as he repeatedly noted throughout his campaign.
Under it, companies are not allowed to engage in mining practices that could pollute streams and drinking water sources. They also must restore streams, and promise to return mined areas to their original form.
They are also forced to replant such areas with native trees and vegetation, and have to test and monitor streams near coal mines before, during and after drilling.
Republican Senator Shelley Moore Capito, from West Virginia, said the Stream Protection Rule was a "last-ditch effort" by the Obama administration to burden her state's struggling coal industry.
"The decision by voters last month makes today’s announcement by the Office of Surface Mining an exercise in futility," she said in a statement. "Working with President-elect Trump and our Republican congressional majority, I am confident that we will be able to use the Congressional Review Act to stop this rule from taking effect.”
The final Stream Protection Rule, which will take effect 30 days after publication in the Federal Register, is available on the OSMRE website.
http://www.mining.com/us-authorities-set-stricter-rules-for-coal-mining-near-streams/
Warm Regards
Anurag Singal
Sr Manager –Business Development
Essel Mining & Industries Ltd
14th Floor, Industry House
10,Camac Street –Kol-71
Ph: 033-30518415,9088026252
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