The company, having notched up an annual turnover of Rs 1,300 crore in 2004-05, expects sales to touch Rs 1,500 crore in the current fiscal.
Mumbai , Nov 16
Shortage of quality coal for thermal power plants has always been a problem for the country, forcing large parcels of coal imports from destinations such as Australia, Indonesia and South Africa.
And this was a window of opportunity that Dubai-based Coal and Oil Company LLC (C&O) seized a couple of years back and is now the leader in this segment.
It imported seven million tonnes of coal into India last year, which accounted for 30 per cent of the country's coal import.
C&O also bought its first coal mine in Indonesia earlier this year.
The CEO and President of C&O, Mr Ahmed Buhari, said the company expects to source coal from this mine in six months. "We are spending some Rs 200 crore on our logistics and in three years we will be a totally integrated energy supplying company," he said.
The company, having notched up an annual turnover of Rs 1,300 crore in 2004-05, expects sales to touch Rs 1,500 crore in the current fiscal. Significantly, 70 per cent of this comes from business in India.
The Government has estimated a shortfall in coal supply to be around 100 million tonnes by 2010. A Citibank survey has put the figure at 160 million tonnes.
"We are the only player to supply coal to seven large IPPs (Independent power producers) in the country," Mr Buhari said. The C&O client list includes Tata Power, Reliance Energy, and Calcutta Electric Supply Corporation.
The company, incorporated in 1998, in Dubai, has an Indian subsidiary company Coastal Energy Private Ltd that has offices in all the port cities. This was in sync with the Indian Government plan to encourage power plants in coastal regions to reduce freight component.
According to Mr Buhari, Indian power companies initially chose C&O because it supplied `effectively cheaper' coal; now it is preferred because (in addition to price factor) it supplies low-sulphur, low-ash coal.
The company was the first to import South African, Chinese and Russian coal. Low ash content coal supplied by C&O has just two per cent ash and mid-ash content coal has nearly 15 per cent ash.
In comparison, Indian coal has 45 per cent ash content. Calorific value of the coal supplied by C&O is around 6,500 gross calorific value - air-dried basis (gcb-adb), while for Indian coal it is never more than 4,500 gcb-adb.
The company says its entry has helped power companies reduce their fuel bills. Mr Buhari said that in the current fiscal Maharashtra State Electricity Board has been able to reduce its expenditure on coal by Rs 50 crore last year while the utility has already saved Rs 18 crore this fiscal.
The company is not too keen to invest in Indian mines at present on account of the captive generation clause. The company, already a big importer of coal into Pakistan, has begun operations in the US too.