Coal major Bharat Coking Coal Limited (BCCL) is staring at a storage problem as coal sale has reduced during the nationwide lockdown.

The gravity of the problem can be assumed from the fact that the coal stocks of around 45 active mines of the BCCL have touched 29.5 lakh tonnes.

The BCCL’s total storage capacity at its collieries is 30 lakh tonnes. The Coal India subsidiary company has also reduced production by around 25 to 30 per cent. Of the production target of 80,000 tonnes per day only 60,000 tonnes is being produced during the lockdown. Coal at present is primarily being sent only to the power plants.

However, demand for electricity has dipped drastically as most industries are shut.

Commercial consumption of power has also reduced as malls, multiplexes and cinema halls are shut.

BCCL director, technical (operations) Rakesh Kumar said that the lack of industrial demand has led to the company producing only around 70 to 75 per cent of its normal coal target.

“Instead of the usual production of around 80,000 tonnes per day we are producing around 60,000 tonnes,” Rakesh Kumar said.

“There’s less despatch of coal from the collieries because of lack of industrial demand. That’s why it is creating problems of stocks for us because we don’t have greenfield mines. Instead, most of the operational mines of the BCCL have been taken over by private companies after the coal sector was nationalised. Many of the mines face the problem of combustion. So, stocking excess coal is a problem,” said Kumar.

“Of the 60,000 tonnes production per day only 30,000 to 40,000 tonnes are being despatched and the rest 20,000 to 30,000 tonnes is accumulating, creating a problem,” he said.

The coal stock of different collieries of BCCL was around 23 lakh in the beginning of the lockdown. In less than 29 days the stock rose to around 29.5 lakh tonnes, clocking an increase of around 6.5 lakh tonnes.

To put this figure in perspective, coal stocks with the BCCL during April last year was 10 lakh tonnes.

On the demand from hard coke industries to revive the fuel supply agreement, (FSA) scrapped last year, Kumar said: “It’s a policy decision which can be taken only at the Coal India level and not at the BCCL level.”

According to the FSA, coal was supplied at notified (cheaper) prices to hard coke industries. After the agreement was scrapped, hard coke owners had to buy raw material coal from autions at a costlier price.

Hard coke owners want the FSA to make a comeback to help them during this industry slump. Insiders at the BCCL are also not averse to it because it will help clear stock and also give impetus to the hard coke industries.