New Delhi: Power Ministry has asked the Steel Ministry to permit state-owned NTPC to exit ICVL, the joint venture formed for the acquisition of coal properties abroad, as the company is finding it economically unviable to go ahead with the proposal.

NTPC had informed the Power Ministry that it should be allowed to exit ICVL because coal requirement of NTPC is very different from those of the steel companies like SAIL and RINL, making the venture an unviable investment for it.

International Coal Ventures Ltd (ICVL) is a JV between SAIL, Coal India, Rashtriya Ispat Nigam Ltd, NMDC and NTPC.

It was conceptualised by the steel ministry for securing much-needed coking coal and thermal coal assets overseas.

"We have written to the Ministry of Steel...to allow NTPC to exit ICVL based on the presentation made by the company," Power Secretary P Uma Shankar told reporters here.

NTPC, in its presentation to the Power Ministry submitted in September, had said that it needs thermal coal and steel companies like SAIL and RINL need coking coal. Hence, there is a clash of interest and they would want to leave the JV.
  
NTPC said, meanwhile, that it has received the approval from the Power Ministry to pull out from ICVL.

"They (Power Ministry) have agreed to our request of exiting the ICVL, the matter would now go to the Cabinet... when I don't know," CMD NTPC Arup Roy Choudhury told reporters here.

On being asked, who would take NTPC's place in the JV Company, Choudhury said, "We cannot decide that."

ICVL was set up was to secure at least 10 percent of the coal requirements of SAIL and RINL, that is five million tonnes per annum, by acquiring or picking up a stakes in overseas mining properties.

It was also expected to meet the requirement of joint venture partners CIL, NTPC and NMDC.

NTPC requires thermal coal for firing its power plants and SAIL needs coking coal for steel-making.

The availability of coking coal is more compared to thermal coal, which is beneficial for steel companies.

At the same time, NTPC is also sourcing coal on its own.

(Agencies)