India eyes coal exports to Bangladesh, but power plants shy away due to lower quality

[Black_cats]

India eyes coal exports to Bangladesh, but power plants shy away due to lower quality​

Photo: Unsplash

Photo: Unsplash

The Indian coal ministry has drafted a plan with the ambition of exporting around 30 million tonnes of coal per year to Bangladesh and Sri Lanka by 2030 from the mines located in its eastern part.

A version of the draft titled "Integrated Coal Logistics Plan" was recently sent for stakeholder consultations, reports S&P Global, a provider of energy and commodities information and a source of benchmark price assessments in the physical commodity markets.

The S&P Global report reads that Indian coal was well placed to replace Indonesian coal in the Bangladesh market and "create a long-term sustainable export-oriented coal market" for Indian producers.

High officials at operational coal power projects, however, said they had no plans to import coal from India due to its low quality.

Engineer Mohammad Hossain, director general at Power Cell, a policy formulation wing of the Power Division, recently told The Business Standard that Bangladesh has in principle decided not to import Indian coal due to its lower quality.

At present, there are two import-dependent large coal power plants in operation, with a demand for around 5.4 million tonnes of coal annually.


Both plants generate electricity by using coal imported from Indonesia.


Besides, 307 MW and 1,212 MW plants in Barishal and Chattogram, respectively, are about to start commercial operations that would also be run on coal imported from Indonesia or Australia.


Shah Abdul Moula, plant manager at the Payra 1,320MW Thermal Power Plant, said the plant requires coal with a 5000 kcal/kg calorific value—the amount of heat energy present in food or fuel—which isn't available in Indian mines.

"We don't have any plans to source coal from India," he added.


The Payra plant is the first import-coal-based plant in Bangladesh that sources coal from Indonesia under a 10-year supply agreement.

Meanwhile, Anwarul Azim, deputy general manager at Bangladesh-India Friendship Power Company Ltd (BIFPCL) also informed The Business Standard that they have no plan to take coal from India because of its quality.

Maitree Super Thermal Power Project (2X660 MW), is the second power generation plant that is also reliant on imported coal.

The plant is owned by the Bangladesh-India Friendship Power Company (Pvt) Ltd, which is a joint venture of the Bangladesh Power Development Board and the Indian state-owned National Thermal Power Corporation.

Like Payra, this plant also sources coal from Indonesia. Currently, it is importing coal under a short contract and is about to enter into a contract to source eight million tonnes.

According to data from S&P Global Commodities at Sea, Bangladesh imported 7.5 million tonnes of coal in 2022, of which 6.6 million tonnes came from Indonesia.

India currently exports around 1-2 million tonnes of coal every year to its neighbouring nations of Bangladesh and Nepal, with no exports to Sri Lanka.

According to the document reviewed by S&P Global Commodity Insights, coal with a 2,950-3,850 kcal/kg GAR calorific value is well placed to replace Indonesian coal in the Bangladesh market and "create a long-term sustainable export-oriented coal market" for Indian producers.

An analysis in the document found that the price of this coal on a CFR Bangladesh basis would be between rupee 2,534-2,976 per tonne ($30–$36 per tonne).

The average price at which Bangladesh imported 5,000 kcal/kg GAR coal in the first five months of 2023 was $106.62/tonne, Platts data from S&P Global showed. Platts assessed 5,000 kcal/kg GAR thermal coal at $97.95/tonne on a CFR Bangladesh basis on 26 May.

According to the report, annual thermal coal demand for power generation in import-dependent Bangladesh is forecast to rise from the present 2.3 million tonnes to 21-25 million tonnes by 2025 to fuel the upcoming coal-based capacities.

India eyes coal exports to Bangladesh, but power plants shy away due to lower quality

The Indian coal ministry has drafted a plan with the ambition of exporting around 30 million tonnes of coal per year to Bangladesh and Sri Lanka by 2030 from the mines located in its eastern part. A version of the draft titled "Integrated Coal Logistics Plan" was recently sent for stakeholder...

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[Indos]

India until now is the biggest Indonesian coal importer, replacing China last year as second biggest importer of Indonesian coal.

 

[bluesky]

Indian coal is full of Sulphur unfit for burning to generate electricity. A kind of low calorie coal burning which causes air pollution.

 

[SoulSpokesman]

@bluesky: Indian coal is full of Sulphur unfit for burning. A kind of low calotype coal.

Indian coal is mostly low sulphur but very high ash, so overall low calorie. There is an exception. Coal from NE India is somewhat similar to Indonesia, low ash, high calorific value but also high sulphur. Both types of coal can be used in power plants, provided the plant is designed to handle that type of coal.

The right thing to do would be to set up thermal power plants in India and export power to BD.

Regards

 

[bluesky]

@bluesky: Indian coal is full of Sulphur unfit for burning. A kind of low calotype coal.

Indian coal is mostly low sulphur but very high ash, so overall low calorie. There is an exception. Coal from NE India is somewhat similar to Indonesia, low ash, high calorific value but also high sulphur. Both types of coal can be used in power plants, provided the plant is designed to handle that type of coal.

The right thing to do would be to set up thermal power plants in India and export power to BD.

Regards

Yes, the ash content of Indian coal is above 35%. So, it has low calorie.

Other points have been noted.