New Maamba mine owners to layoff workers - Mentioned in the Lusaka Times

Maamba Collieries (MCL) Coal Mine new owners, NAVA BHARAT venture will layoff all employees and pay them their terminal benefits.

The Company's Executive Officer Kalunga Mumba told workers in a memo that MCL Board of Directors has decided to send all the miners on voluntary separation exercise with effect from August 31 to November 30, 2010.

Mr Mumba said the company would undertake a voluntary separation exercise as a strategy to reorganize their business and give employees a chance to get their terminal benefits. The workers have also been told to reapply for their positions.
He said the Company would support them to address any negative impact that the exercise may have on their future livelihood.
Mr Mumba informed the workers that voluntary separation procedures and application forms would be circulated to all employees in two weeks time.
However, the move is contrary to the MCL’s former Executive Officer Dipesh Dipu who informed the miners on 3rd May that no one would lose employment except the ones who will fail to fit in the new system.


Mr Dipu said that: “Maamba is going to change; we have to work hard to ensure that we are part of the history and benefit from the wealth we are going to create.”

“We need to look beyond the horizon and see the lives of people of our country being lit up by coal we produce and power we generate,” Mr Dipu said.

NAVA BHARAT venture is owns about 65 shares in Maamba Collieries (MCL) Coal Mine while government has 35 percent.

PF’s Nchanga MP urges govt to sort out mess at KCM - Mentioned in the Post

NCHANGA Patriotic Front (PF) parliamentarian Wylbur Simuusa has called on the government to sort out what he terms the mess they have created for Konkola Copper Mines (KCM) workers.
Commenting on the planned peaceful demonstration by KCM workers over the continued outsourcing of key activities at the mining giant, Simuusa accused the government of ignoring the problems at the mine for a long time now.
He said the government had sided more with KCM than their citizens, hence the mining company's disrespect for workers' rights.
"First of all, I must declare my full support for the planned peaceful demonstration by KCM miners. This is because my colleagues in the MMD government are stubborn. These problems at KCM started a long time ago, and I remember calling on this government to sort it out early enough. They created this mess because of their stubbornness, so let them help KCM sort it out," Simuusa said.
"But because they have given too much liberty to mine owners to abuse workers, these MMD colleagues cannot see beyond the benefits they are getting as a party from KCM. So, I support the workers and the Mineworkers Union of Zambia (MUZ) for reacting timely. It seems the only language this government understands is a demonstration. Let the miners fight for themselves since their own government has ignored them."
Simuusa said there was no way KCM could terminate some workers' contracts abruptly without regard for their feelings.
"For example, KCM is handing over some of its employees to contractors who cannot guarantee their job security. There is also the situation of machine operators from the open-pit mine who have been brought to the surface to sweep. Now, does that guarantee job security when people are left in suspense?" Simuusa wondered.
"KCM are behaving like that because the MMD government has given them the leeway. When they fire workers without any reasons or whatever wrong decisions they make, this government keeps quiet. Issues go unattended as if these miners do not have a government to protect them. Maybe KCM has been sponsoring MMD in whatever way, and so the government has been crippled by that."
He warned KCM and the government against ignoring the problems facing the miners.
"I know our colleagues in this government are very stubborn, but I still appeal to them to deal with this mess they created. They should not blame anyone when miners react in the way they want to because this issue has been boiling for some time now. Just late last year, President Rupiah Banda told KCM to fire all workers who participated in a protest. And this is the man who should be defending his own people. So, if the President can betray his own people, do you expect a foreigner to embrace them?" Simuusa asked. And Simuusa challenged the government to explain circumstances which led to the resignation of Nava Bharat chief executive officer Dipesh Dipu immediately after his appointment a few months ago.
Simuusa said people had every reason to speculate that the government had a hand in his resignation.
"Why has the nation not been told why the chief executive officer of Nava Bharat resigned barely five months after his appointment? I raised this issue in Parliament a few weeks ago but, as usual, Vice-President George Kunda rubbished it. Maamba Collieries, where Nava Bharat has majority shares, is a quasi-government institution and as such the government should take keen interest when a CEO makes such an abrupt decision,” said Simuusa.
“For example, when Zain managing director David Holiday resigned a few days ago, people got concerned. And Zain had to issue a statement to clarify that. This should be the case on matters to do with big entities like Maamba Collieries.”
On Friday last week, miners from Nkana, Nchanga and Konkola units gathered at MUZ offices at Katilungu House in Kitwe where MUZ and the National Union of Miners and Allied Workers (NUMAW) held a joint press briefing and sang solidarity songs to denounce KCM management.
The union officials said outsourcing needed to be halted as a matter of urgency.

Coal supplies running on empty - Quoted in the Mint

R.S. Sharma, chairman and managing director of India’s largest power generation utility, is a worried man. His concern stems from the fact that at least 80% of state-run NTPC Ltd’s installed capacity of 32,194MW is coal-based and there just isn’t enough fuel to run them.


“While there is a problem due to some expansion projects getting stuck, we are trying to meet the gap through imported coal,” Sharma said.

The irony is that the country’s most vital primary source of energy is actually quite abundant but between extracting the coal and getting it to the power stations lies a range of hurdles, including environmental and law and order issues and lack of investment.

Power projects face the maximum crunch, as the sector is the biggest consumer of coal, absorbing 78% of domestic production.

Key issues that plague the sector are delays in land acquisition for coal mining, tardy forest clearances, the absence of a regulator for the industry and inefficient mining.

“Coal is likely to continue to provide 60-70% of the generating capacity. Luckily it is a resource that is largely indigenous and seems abundant,” said former power secretary Anil Razdan. “However, seeing the appetite of the Indian power sector, we should immediately start acquiring coal assets abroad just as China has done, and build coastal thermal plants based on imported coal. Ports and rail links are to be developed for transporting imported coal.”

While several Indian firms have been looking to acquire overseas coal assets, they have to compete with leading Chinese government-run coal miners such as China Shenhua Energy Co. Ltd and Yanzhou Coal Mining Co. Ltd. Thus far, apart from a few private sector successes, a majority of the firms have largely been unsuccessful in securing coal concessions overseas.

According to the government, the power sector is facing a coal shortage of around 105 million tonnes per annum (mtpa), which is expected to rise to 225 mtpa by 2012. As of 4 July, eight power plants had reserves of fewer than four days and 31 had fewer than seven days.

“A lot of coal is at the pit head. We want it to reach the projects,” power secretary P. Uma Shankar had said earlier. “We have asked a number of agencies to import coal.”

Demand is around 600 mtpa and set to touch 2,340 mtpa by 2030. India has a known resource base of 264,000 mt, the fourth largest in the world, of which proven reserves are around 101,000 mt.

Analysts believe that the government’s attempt to control demand and supply has skewed the pricing mechanism and created distortions. That’s resulted in inadequate investment in new projects, acute shortage of capital and physical resources for exploration and a burgeoning gap in demand and supply.

“The sector is one of the most regulated ones, but the effectiveness of these regulations can well be gauged from the extent of illegal mining and transportation of coal,” said Dipesh Dipu, an expert on the mining sector. “The captive mining rules for coal, coupled with acute shortages, create unmet demand for coal.”

State-run Coal India Ltd (CIL), which has an 82% share of the country’s coal production, has been unable to keep pace with rising demand. It produced 431.27 mt in 2009-10 against a target of 435 mt.

CIL chairman Partha S. Bhattacharyya did not respond to repeated phone calls or to a message left on his cellphone.

Acknowledging ecological concerns, the ministry of environment has suggested a ban on mining in almost half the area under nine key coalfields.

The issue of no-go areas for mining has even threatened to derail the Congress-led United Progressive Alliance government’s ambitious programme to build big power plants with an installed capacity of at least 4,000MW each.

“There is urgent need for fast-track forest clearance. Coal is available almost entirely in forest areas,” Razdan said.

To remove the opaqueness and irregularities surrounding the award of so-called captive coal blocks, the government introduced the Minerals (Development and Regulation) Amendment Bill for allotting captive blocks to iron, steel, power and cement firms that use the coal for their own plants. Introduced in the Rajya Sabha in 2008, it is yet to be passed.

“Reforms in the coal sector have not progressed much due to the government playing the roles of both regulator and active monopolistic participant,” said Dipu.

NTPC floats $1.5 bn tender for coal imports - Quoted in the Mint

India’s largest power generation utility NTPC Ltd has floated an international tender for the direct procurement of 14.5 million tonnes of coal for the first time. Valued at around $1.5 billion (around Rs6,990 crore), the tender is the fallout of a controversy over state-owned trading firm MMTC Ltd’s execution of an order to import 12.5 mt coal for NTPC.

Direct coal imports will exclude state-owned trading firms such as MMTC and State Trading Corp. of India Ltd, the usual conduits for such trade, but help NTPC buy coal at competitive rates, avoid paying commission and thus lower generation costs. The decision is in line with a new coal import policy approved by NTPC’s board.

“This is a tender for direct coal import and will help in reducing fuel costs,” said R.S. Sharma, chairman and managing director of NTPC.

Mint had reported on 5 August about NTPC’s plans to import coal directly. One of the bidders for an earlier tender floated by MMTC on behalf of NTPC, Knowledge Infrastructure Systems Pvt. Ltd, had alleged wrongdoing in the way the order was executed, and demanded an investigation into the procurement process and an intervention by the Prime Minister’s Office.
The new tender calling for expression of interest (EoI) was floated on 20 July and the last date for the submission of EoIs is 10 August. The utility has invited proposals from coal suppliers for buying 14.5 mt of coal either on free-on-board (f.o.b.) basis or cost and freight (CFR) basis.
In the first method, the responsibility of shipping the coal is with the buyer (NTPC), whereas the supplier will have to make shipping arrangements in the second. The tender also seeks proposals for transporting coal from the originating port to the discharge port in India as well as for handling and transportation of imported coal from the discharge port to NTPC’s power stations.
Fuel supplies are critical for NTPC as most of its coal-based projects don’t have sufficient stocks. At least 80% of its installed capacity of 31,704MW is coal-based. NTPC owns and operates 15 coal-based power stations and has a coal requirement of 150 mt per annum (mtpa). Its coal imports are likely to increase to about 24.8 mtpa by 2015-16.

According to the policy that will hurt revenue from coal imports at state-owned trading firms, NTPC will source the fuel through a combination of direct imports and purchases through state-run Coal India Ltd. It may import small quantities through traders during exigencies.

Analysts believe that the cost advantage in the tendering process is determined primarily by the degree of competition and risk perception, including counterparty risk, credit risk and supply chain risks. “From the competition perspective, bulk procurements may attract a higher degree of competition. This may be negated if the qualification criteria are perceived as favourable to a few, in which case the market can be compared with that of monopolistic competition,” said Dipesh Dipu, an expert on the mining sector. “Also, counterparty and credit risks will be lower if the buyer procures directly rather when the intermediaries are involved.” “Overall, it appears that NTPC may get better pricing if they can ensure higher degree of participation in the tender process, particularly from the coal mining companies,” he added.

Coal demand in the country is around 600 mtpa and is set to touch 2,340 mtpa by 2030. India has a known coal resource base of 264,000 mt, the fourth largest in the world, of which proven reserves are around 101,000 mt.