By Ajoy K. Das
In one of its most aggressive expansion moves, India’s state-run Coal India Ltd. (CIL) has approved 32 new coal projects, representing an estimated capital expenditure of $6.57 billion.
The expansion program that includes 24 brownfield and eight greenfield projects aim to drive annual coal production of 1 billion metric tons (mt) by 2023-2024, up from 650 million mt by end of 2020-2021 and reduce imports. During April-January 2020-2021, Indian coal imports were pegged at 181 million mt.
More significantly, the Indian government’s push to ramp up CIL’s coal production comes parallel to its increase in renewable energy generation target to 175 gigawatts (GW) by 2022 and 440 GW by 2030, up from 90 GW at present.
A CIL official said even with the government’s ambitious plans on renewables, coal will continue to dominate the Indian energy sector and account for 50% of domestic energy generation capacity, even with 440 GW of renewable power generation capacity achieved by 2030.
He said the combined incremental peak rated capacity of the 32 projects approved would be 193 million mt. Of this total, 85% or about 167 million mt would be accounted for by brownfield and greenfield projects to be implemented by three of CILs’ wholly owned operational subsidiaries — South Eastern Coalfields Ltd. (SECL), Central Coalfields Ltd. (CCL) and Mahanadi Coalfields Ltd. (MCL).
Apart from the $6.57 billion investments on new projects, CIL has set up a war chest for expansion of mining infrastructure and allied ancillary investments up to 2023-2024. Of this, an estimated $8 billion on infrastructure development at existing mines and $4.72 billion on augmenting coal evacuation infrastructure including mechanized coal handling and transportation conveyor systems and rail links to mine heads and another $3.26 billion on clean coal technologies.
According to the CIL official, the basket of projects approved by the miner was the result of re-strategizing and nixing some projects conceived earlier which were labor intensive and it was imperative to renew focus on productivity levels against backdrop of opening up of coal mining to private miners.