Will pass on cost if we import coal: Coal India.

Coal India chairman and managing director Narsing Rao told CNBC-TV18 that around 10 FSAs have been inked at the subsidiary level and that the PSU would pass the cost incurred on the customer if there was need to import coal.

Rao also says that he is unable to comment on the penalty and is not aware of the IPPs that have inked FSAs. The chairman explains that he did not know if all the IPPs would ink the FSAs and says that he would enquire into NTPC ’s refusal to sign the FSAs.

Rao concludes that Coal India has no plans to revise prices.

Below is an edited transcript of the interview with CNBC-TV18. Also watch the accompanying video.

Q: What is the update on FSAs being signed by the IPPs?

A: Some progress has been made in the signing of the FSAs. Around 10 have been signed at the subsidiary level. We will take stock of the situation including the concerns of our customers.

I will not be able to comment on the penalty because that is what has been approved by the board and so as of now, that stands.

Q: Which parties have already signed FSAs?

A: I am not aware of those names as of now but it will be known in a couple of days.

Q: The new FSA model that has been released has a lot of clauses that actually safeguard Coal India’s interest. The first major clause states a very minimal penalty to IPPs, is perhaps based on their apprehension of putting pen on paper. NTPC reportedly said that it’s not willing to sign the FSAs.

Do you think all of the IPPs will sign the FSAs?

A: I have not received anything apart from what has come in the press. We’ll certainly look into it (NTPC) and see if they have some feedback.

Q: Have you explored the possibility of having to import coal? If you do, will you pass on the additional cost to the power producers?

A: We have not yet decided on imports and that will be based on the feedback from customers. Only after analysis of the feedback, we will take a decision on importing coal.

But one thing is very clear, if we have to import that cost will be passed on to the customers.

Q: There is an expectation that Coal India could look at revising prices applicable from the April 1 in the near future. What's the quantum you plan?

A: There are no plans to revise prices. There was some correction or revision that took place earlier effective January 31. But there has been a return to the old prices with the only shift being from UHP to GVC without any change in price. There are still issues on quality and calorific value.

I plan to resolve them as soon as possible.

Source : moneycontrol.com