Coal India may have to revise Rs. 600 bn capex estimate

CIL is planning to raise coal production from underground mining to 100 million tonnes in the next 10 years, CIL Director (Technical) N. Kumar said.

Coal India Ltd. (CIL) may have to revise its capital expenditure plan in view of the proposed land acquisition bill. “The current estimate of total capex is Rs. 60,000 crore over the next five years. But it may get revised due to land acquisition bill,” Coal India Chairman Sutirtha Bhattacharya said at the company's AGM on Wednesday.

CIL had envisaged capex of Rs. 60,000 crore to ramp up production to 908 million tonnes.

“There are some issues with regard to land acquisition. The final capex amount will eventually depend on the amount of land acquired,” Bhattacharya said.

A large portion of the money would go towards acquisition of land required for mining of coal and the rest for buying machinery and equipment for the same, the CIL Chairman said.

CIL requires 20,000 acres in next five years to achieve its target of 908 million tonnes. The cost of land acquisition would depend on the proposed land bill which seeks higher compensation.

Separately, CIL Chairman told the shareholders that the company was in talks for acquiring mining assets overseas.

“We are pursuing diplomatic channels while pursuing these assets. We are in talks with various countries for buying mining assets,” Bhattacharya said.

CIL is planning to raise coal production from underground mining to 100 million tonnes in the next 10 years, CIL Director (Technical) N. Kumar said.

“We are looking at ways to increase underground mining production. Currently, nearly 93% of Coal India’s total production comes from open cast mines,” Kumar said.