Power trader PTC India has signed a five year agreement to buy 700,000 tonnes of Indonesian coal a year for sale to Indian power projects.

Mr TN Thakur chairman of Power trader PTC India said that PTC Energy, fully owned by PTC India, has a signed a five year contract with a company, which has a stake in an Indonesian coal mine.

Mr Thakur did not elaborate on the price at which the deal has been struck. "We have put a floor price and a ceiling price...so we don't take undue risk on the volatility of coal prices."

India has 10% of the world's coal reserves, the biggest after the United States, Russia and China, but its coal imports have grown rapidly to an estimated 70 million tonnes in the fiscal year ended March.

The country's thermal power generation in June was constrained by limited availability of coal.

Mr Thakur said the company has already sold 300,000 tonnes of coal to power produces in the April-June quarter and hoped to sell the remaining 400,000 tonnes in rest of the fiscal year.

He said that PTC Energy had also executed about 40,000 tonne of spot sale-purchase of coal during June quarters.

(Sourced from Reuters)