KOLKATA (miningweekly.com) – Taking its cue from Coal India Limited (CIL), Indian power producer NTPC Limited was seeking to establish a joint venture (JV) to secure coal blocks in South Africa.

Acknowledging that the proposal was still at a preliminary stage, a Coal Ministry official said NTPC’s South African JV would be based on bilateral talks between the two countries, as similar negotiations had been held in the case of a CIL JV in South Africa.

He said the increasing interest by Indian companies to establish JVs in the African State was a direct result of the India–Africa Summit concluded last month.

“We have the resources and the Make in India Initiative can get a boost with the help of technology which India has. Investments in South Africa can also be a programme to Make in Africa,” the official quoted South African International Relations and Cooperation Minister Maite Nkoana-Mashabane during the summit, which was the trigger for deepening bilateral negotiations toward the formation of more JVs in the South African coal sector.

As a precursor to starting government-to-government talks, NTPC had been asked to finalise the parameters of its requirements for imported feedstock both in terms of volumes and grades.

The power utility was looking to pick up minority equity stakes in proposed JVs that would give it access to imports of around 17-million tonnes of coal a year.

In South Africa, NTPC was seeking coal in grades ranging between 3 200 and 6 000 gross calorific value (GCV), which would enable it to blend imported coal with supplies from CIL, to achieve higher efficiencies of its thermal power plants.

Coal Ministry officials said that, while NTPC had officially floated expressions of interests seeking partnerships with coal asset owners overseas, the proposed JV in South Africa would be outside the purview of such a bid, as the South African JV would be based on government-to-government talks linked to the allocation of coal blocks by South African provinces.

It was pointed out that during the India-Africa Summit, representatives of the South African government had stated clearly that investments in the country would need to be backed by the induction of technology and the training of locals.

It was possible that NTPC’s African venture would be spearheaded by its specialised mining division, which was currently being set up to take charge of the power producer's domestic and overseas mining assets.