In order to meet up the shortage of coal at its power plants in India, NTPC is looking to acquire majority stakes in Indonesian coal mines having reserves of around 200-300 million tons.

The deal is likely to finalize by the end of the existing fiscal, ending Mar. 31, 2009.

R S Sharma, chairman and managing director of NTPC, said that the company has already nominated three merchant bankers for the purpose.

But Mr. Sharma declined to give the names of the bankers and other details.

An analyst said, “A coal mine acquisition abroad will be positive news for NTPC as its primary supplier, Coal India Ltd is likely to reduce the coal supply to it by about 20% due to reallocation.”

NTPC has been seeking coal sources overseas for a while now, he added.

“The coal found in Indonesia and Australia is of very good quality, and as a result generates more heat per unit of quantity, against the Indian coal,” the analyst also said.

During the last fiscal, NTPC imported 2.5 million tonne of coal out of the total 122.94 million tonne it consumed during the same period.

Due to growth of generation capacity, the company’s coal requirement is expected to climb to around 126-130 million tonne in the existing fiscal.

NTPC secured the “Pakri Barwadih” coal mining block in Jharkhand in 2007-08, to dig out coal for captive use at its power plants.

Now, the company targets 1-1.5 million tonne of initial coal production from this block. Earlier, the production from this coal block was planned to start from the last fiscal, but it has been delayed primarily due to the land acquisition issues.

NTPC has decided to fabricate 40-45 million tonne of coal yearly from its captive mines by the next 6-7 years in order to fulfill 20% of its fuel requirement.

The company is also looking at Engineering Procurement Construction (EPC) deals in the Middle East.

Moreover, the company is also eyeing to source 3 million tonnes of liquefied natural gas (LNG) from Nigeria to establish a 700 MW gas-based power plant and a 500 MW coal-based plant in the African nation.

The company's focus areas also include re-powering and replacement of old units, introduction of ultra supercritical technology and clean coal technologies.

Shares of the company, on Monday (May 12) gained Rs 0.5, or 0.26%, to end at Rs 192.3 on the Bombay Stock exchange (BSE). The total volume of shares traded was 1,073,923.