Wants ‘biggest bottleneck’ to be tackled soon.
State-owned mining major Coal India Ltd, which accounts for over 80 per cent of the country’s coal production, is gearing up to solve the biggest operational bottleneck that it faces — transportation.
The miner, which is expected to come out with its initial public offer towards the end of this calendar year, has roped in consulting firm KPMG to frame and implement a new corporate plan over the next 18 months. However, CIL wants to resolve the transportation issue in the short-term.
“The basic issue that needs to be addressed concerns despatch. Although production potential exists, transportation is a big bottleneck. First, the coal needs to be sized and despatched efficiently from the pit-head to the (railway) siding and then, it needs to be transported elsewhere based on the availability of (railway) wagons,” CIL Director (Technical) N C Jha said.
Admitting that the issue was hampering the company’s current production level, Jha said it could have a larger impact looking forward, unless addressed immediately. “It is an external and internal problem. Some way forward will have to be planned,” he added.
With the country’s demand for coal growing steadily, CIL is finding it difficult to keep pace due to a number of reasons, including inordinate delays in the procurement of environmental and forest clearances. The mismatch between supply and demand could be in the range of 120 million tonnes in the coming financial year, analysts said. Therefore, if the miner is unable to despatch the excavated coal, there could be a further increase in shortfall.
For instance, there is a coal stockpile of about 20 million tonnes at Mahanadi Coalfield, a CIL subsidiary, which cannot be despatched due to a shortage of wagons. In many upcoming projects in the valley, Talcher and North Karanpura coalfields, the current railway infrastructure was grossly inadequate, sources said. As a result, coal consumers such as the power sector could be hit.
Consequently, KPMG has been instructed to immediately analyse the logistic-related functions at CIL and submit its suggestions to resolve this at the earliest. “We have asked them (KPMG) to undertake a rail-infrastructure and an equipment utilisation study at the earliest. They are constantly interacting with a core committee from CIL as well as those from the subsidiaries,” a senior CIL official said.
On its part, KPMG said it would look at the availability of logistic capacity and coordination of available resources.
