WCL and Mahagenco sign coal supply agreement

Nagpur, Mar 9 (UNI) Public sector coal company Western Coalfields Limited (WCL) and Maharashtra State Electricity Generation Company (Mahagenco) have signed a coal supply agreement on negotiated price basis.

The agreement was signed by WCL Chairman-cum-Managing Director D C Garg and Mahagenco Managing Director Ajay Mehta last week, according to a WCL press release here.

The agreement is for dedicated supply to Mahagenco by WCL from a new project in Vidarbha, namely Junad extension opencast mine, with a production capacity of 0.6 million tonnes per annum (mtpa), in Yavatmal district.

WCL already has coal supply agreements with Mahagenco on negotiated price basis for five other mines -- Adasa underground mine (0.21 mtpa), Kolgaon open cast mine (0.40 mtpa), Bhatadi open cast expansion (0.65 mtpa), Durgapur extension (2.0 mtpa) and Waghoda underground mine (0.39 mtpa), the press release said.

The negotiated price mechanism would ensure an Internal Rate of Return (IRR) of 12 per cent for WCL, it said. At the same time, it ensures dedicated supply of assured quantity and quality of coal from the producing company, it added.

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