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Techno-Commercial Analysis of Importing Indonesian Coal for Krishnapatnam Ultra Mega Power Plant 6 X 660 MW

Ultr

a Mega Power Plant 6 x 660 MW

Mr. Manoj Vyas - MBA Power Management Shri. Anil Kumar – Project Guide, Senior Analyst. NPTI Faridabad (Under Ministry of Power, Govt. Of India) manojvyas.ee@gmail.com

In this paper, a techno-commercial analysis method based on comparing 3 coal exporting countries in
In this paper, a techno-commercial analysis method based on comparing 3 coal exporting countries in
Asia–Pacific region has been done for a 6 x 660 MW imported coal based ultra mega power plant
employing supercritical technology from Shanghai Electric Corp., China located in Krishnapatnam (A.P,
India) to show “How much economic is importing coal for Krishnapatnam UMPP ”. Annual coal
requirement is 15.33 MTPA @ 4290 Kcal/Kg (GCV) on GAR basis from Indonesia. FOB for Indonesian is
$ 50 /T & landed cost is $ 70.4 /T on CIF basis at plant site. Coal is imported in CAPESIZE vessels of
1, 75,000 DWT (87,500 GRT) @ 15 Knots in 7.5 days from Indonesia. KUMMP was awarded to
RELIANCE POWER LTD, & PPA of levelised tariff of Rs. 2.33/Kwhr has been signed between the
beneficiary state (T.N, A.P, Maharashtra & Karnataka) for 25 years. Analysis for cost formation of the
landed cost of imported coal at power plant site as well as the effects of coal consumption , cycle time
of vessels, different routes, duration & delivery time and characteristics of Indonesian coal has been
discussed. Indonesian coal is most economical because of short distance and huge availability to meet
plant requirement. Thus coal consumption is reduced by employing supercritical technology in KUMPP
as heat energy produced by imported coal is more efficiently utilised for generating electricity.
umpp is located near krishnapatnam village in muttukur mandal of Nellore distt of coastal Andhra Pradesh.
K
LATITUDE 140 – 18’ – 26” N & LONGITUDE 800 – 07’ – 11.81” E. It has 6 units of 660 MW each which is to be
commissioned by 1st
April 2013. The has installed capacity of 3960 MW.
Contracted capacity is of
3465
ABSTRACT

MW to 3762 MW, employing supercritical

Some parameters to be considered for each unit :-

technology from Shanghai Electric

Pressure: 247 kg/sq.cm (abs)

Main steam temp :535 ° C

Reheat temp : 565 ° C

Station heat rate : 2250 Kcal / Kwhr

Availability :90 %

PLF : 85%

Project Dynamics

The most suitable location for importing coal are south Africa, Australia & Indonesia in Asia- Pacific region.

15.33 MPTA is annual coal requirement , 2076 tph ,49824 tpd @ 4290 Kcal/Kg (gcv) on GAR basis.

Coal is imported on AR & DB basis .

a. AR (as received)- includes total moisture

b. DB (dry basis) - excludes all moisture

Sharing of power- 40 % to A.P & 20 % to Maharashtra, T.N, Karnataka each.

The nearest port to plant site is Krishnapatnam port.

a. One of the India’s largest and fastest growing seaports, Krishnapatnam Port.

b. It is fast becoming a port of choice for all international cargo originating from and destined to the Southern and Central India.

c. Can store 0.63 MT (15 days) of coal at port and 1.26 MT at plant site for (30 days)

d. Maximum handling loss of 0.2 % at port.

Coal Linkages & Coal Markets

There are 2 coal markets in w orld Atlantic & Pacific.

The coal can be purchased on

basis. Types of coal are hard & soft on the availability basis.

Hard & soft coal be further bi furcated into coking (for iron & steel manufacturing) & non-c oking coal (for power generation).

contract basis & spot market

Atlan tic South Africa Colu mbia
Atlan tic
South
Africa
Colu mbia
Pacific Indonesia Australia China
Pacific
Indonesia
Australia
China
 

A

USTRALIA

SOUTH AFRICA

INDO NESIA

INDEX

 

NEWC

RB

 

ICI

Price(fob) US$

 

160

155.13

 

50

(4 Aug-2008)

   

GCV(Kcal/Kg)

 

6300

6000

4

200

Time In Delivery(Day

 

17.42

13.35

7

.50

Indonesia

Indonesia is world’s no .1 thermal coal producer. Indonesia has an esti mated amount of 90 bn tons of coal resources and 1 8.5 bn tons of coal reserves. More than 64% M ore than 64% of country’s coal reserves are present in the South Sumatra.

1%
1%

South suma tracoal reserves are present in the South Sumatra. 1% east kalima ntan riau south kalim antan

east kalima ntanreserves are present in the South Sumatra. 1% South suma tra riau south kalim antan others

riauin the South Sumatra. 1% South suma tra east kalima ntan south kalim antan others •

south kalim antanthe South Sumatra. 1% South suma tra east kalima ntan riau others • RCRPL has acquired

others1% South suma tra east kalima ntan riau south kalim antan • RCRPL has acquired Sri

RCRPL has acquired Sri vijaya Bintangtiga Energy, Bryayan Bintangtiga E nergy and Sugico Pendragon Energy in th e South Sumatra area of Indonesia spread ove r an area of 40,000 hectares.

The coal from the mine s would be supplied to Reliance Power’s 4,000- MW Ultra Mega Power Project at Krishn apatnam in Andhra Pradesh and also to the Sh ahapur power project in Maharashtra

Reliance has acquired

mines with reserves of 2 billion tonnes on a risk -free production-

linked model

Since the mines are lo cated in the South Sumatra region which is clos er to India's east coast, shipping time will be cu t down by two days

Reliance plans to build infrastructure, including a 100-kilometre railwa y line

The three mines acqui red by Reliance Power in Indonesia have coal re serves valued at about Rs 20,000 crore

Coal Analysis

There are 3 types of coal analysis:

a. Qualitative : proximate analysis & ultimate analysis

b. Quantitative: coal consumption on hourly, daily, monthly & annual basis.

c. Cost: among Australia, South Africa & Indonesia as per there coal indices .

GCV of Coal (designed)

4290 Kcal/Kg

Specific coal consumption 0.5244 kg/kwhr
Specific coal consumption
0.5244 kg/kwhr

Hourly consumption of coal(6X 660MW)

1750 Te

Daily coal consumption @85% PLF 4200 Te
Daily coal consumption @85% PLF
4200 Te

Annual coal requirement @85 % PLF

15.33 MTPA

Description GCV(GAR) Price(US $) as on TM(GAR)% Ash(GAR)% Sulphur% quality Kcal/kg 06-june-08 ICI-1 6500
Description
GCV(GAR)
Price(US $) as
on
TM(GAR)%
Ash(GAR)%
Sulphur%
quality
Kcal/kg
06-june-08
ICI-1
6500
120.36
12
12
1
ICI-2
5800
95.17
18
10
0.8
ICI-3
5000
75.58 30
8 0.6
Reliance coal
4290 50
33.30
2.60 .24
ICI-4
Departure Total Distance Sea time Port time (including 1 Port name Speed (Kts) delivery Arrival
Departure
Total
Distance
Sea time
Port time
(including 1
Port name
Speed (Kts)
delivery
Arrival
(Km)
(days)
(days)
day at
time
loading port)
Tarah coal
15-8-2008
20-8-2008
terminal,
3667
15
5.50
2
7.50
7
hrs
23:32hrs
Indonesia
Richards bay
15-8-2008
27-8-2008
7569
15
11.35
2
13.35
port, SA
7
hrs
15:27 hrs
New castle
15-8-2008 7
30-8-2008
port,
10281
15 15.42
2 17.42
hrs
17 hrs
Australia

Ship scheduling

Cycle time

1+5.50+1+1+5.50=14days

No.of available days

320

No.of voyages

320/14=23

Qty per vessel(175 DWT) CAPESIZE

87500 GRT approx

Annual capacity

87500 X 23=2 MT

Annual capacity of 8 vessels

16 MTPA

The requirement of 15.33 MTPA of the KUMPP can be met with ease by above method.

Landed Cost of Indonesian coa l

Landed cost consist = FOB ($ 50) + freight rates + inland handling charges at Krishnapa tnam port.

= CIF + inland

handling charges at Krishnapatnam port = $ 70.4

Data for calculating landed cost :

a) Cost of coal at Indonesian

b) quantity of coal imported form Indonesia through 175000 DWT vessel = 87,50 0 T

c) rail distance (in km) fo r carrying coal from Indonesian Mine end to Ind onesian Port =100 Km

d) transportation cost of c oal/tonne/km= Rs.1 /Km

e) coal handling charges / tonne at Indonesian Port = Rs. 320

f) Sea - route Distance (in Km.) = 3667 Km

g) transportation cost of c oal/tonne/km (through sea)=

h) coal handling charges / tonne at Krishnapatnam Port = Rs. 259

coal = Rs. 2000 @$ 50 /T ($ 1= Rs. 40)

Rs.

.30

Options for sourcing coal

There are 3 options for sourcin g coal:

a. Port > conveye r> project site

sourcin g coal: a. Port > conveye r> project site b. Mid sea Ancho rage >

b. Mid sea Ancho rage > canal system > project site

b. Mid sea Ancho rage > canal system > project site c. Mid sea ancho rage

c. Mid sea ancho rage > captive port > conveyer > project site

rage > canal system > project site c. Mid sea ancho rage > captive port >

PDCA Cycle

Plan : To procure best quality coal at cheaper rates

Do : search various locations , supply chain, logistics & risk analysis

Act : efficient power at cost - effective rates

Check: Bottlenecks, cycle time, escalations, requirement

Questions

1. What is supercritical technology and what is the significance of it in case of UMPP & coal consumption?

2. What is coal linkage and how it is different from captive coal mines?

3. How many coal linkages have been notified so far?

4. How ship scheduling has been carried out in this case?

5. What would be the landed cost in this case and how it is calculated?

6. Which is best option for sourcing coal & why?

7. What are INCO-TERMS? Differentiate between those which have been used here.

8. How many types of vessels are there in world for transporting coal? Name few with their capacities.

9. What will be the landed cost if reliance would have purchased its mine in Kalimantan, the place where TATA has acquired mines?

10. Calculate the price escalation as per CERC guidelines for importing coal for 25 yrs for KUMPP.

11. Why china has stopped exporting coal?

12. What are the main reasons for increase in freight rates & coal demand?

13. What are various factors affecting global FOB coal prices?

14. Is there any risk in Indonesian mines? Discuss.

15. Name Indonesian coal price index. Name some international coal price indices .Why Indonesia has formed its own coal price indices?

16. Why Indonesian mines for Krishnapatnam UMPP?

17. Is there any potential for sequestration of carbon-dioxide at Krishnapatnam UMMP?

18. COAL is providing enhanced security for power plants. Why?

Bibliography

1. www.mjunction.com

2. www.coal.nic.in

3. www.infraline.com

4. www.ausraliancoal.com

5. www.argus.com

6. www.globalcoal.com

7. www.plats.com

8. www.mccloskey.com

9. www.barleyjonker.com

10. www.coalindoenergy.com

Manoj Vyas- MBA (Power Management) Shri. Anil Kumar- Project Guide (Senior Analyst) NPTI – Faridabad
Manoj Vyas- MBA (Power Management)
Shri. Anil Kumar- Project Guide (Senior Analyst)
NPTI – Faridabad