Coal India Limited: History, Evolution, Development and Key Milestone

To meet growing coal demand, Indian government formed Coal India Limited on November 1, 1975, under Coal Mines Act, 1973.

As India gained independence, there was a growing demand for coal production, especially during the First Five Year Plan. In 1951, a Working Party for the coal Industry was established, comprising representatives from the coal industry, labor unions, and the government. They proposed bringing together small and scattered coal-producing units into a unified sector under national control. This laid the foundation for a nationalized coal sector. Integrated planning in coal mining became a priority after independence. The National Coal Development Corporation was created, initially managing 11 collieries. Its main objectives were to discover new coalfields and accelerate the development of new coal mines.

Nationalization of Coal Industry in India

The nationalization of India’s coal industry in the early seventies stemmed from two significant factors. Firstly, there was a global oil price shock that prompted India to reevaluate its energy sources. A committee, the Fuel Policy Committee, was formed to examine the country’s energy options, and it concluded that coal was the most viable commercial energy source.

Secondly, despite the crucial need for investment in the coal sector to support its growth, private investment was insufficient. Most coal mining operations were in the hands of private companies, and they were not adequately investing in the sector.

The late Mohan Kumaramangalam, one of the key figures behind the nationalization effort, outlined several objectives for the move:

• Conservation of Coal Resources: This involved stopping wasteful, selective, and harmful mining practices, particularly for coking coal, which was a scarce resource in the country.
• Planned Development: The aim was to develop available coal resources in a systematic manner.
• Safety Standards: There was a pressing need to improve safety standards in coal mining operations to protect the workers.
• Adequate Investment: Ensuring sufficient investment to optimize coal utilization in line with the country’s growth requirements was crucial.
• Quality of Life Improvement: Enhancing the quality of life for coal miners was another important objective.

Prior to nationalization, coal mining was primarily in the hands of private miners who often neglected scientific methods and engaged in unhealthy mining practices. The living conditions for coal miners under private ownership were substandard.

Nationalization was seen as a solution to these issues, aiming to address the inefficiencies and neglect in the coal industry, while also ensuring better outcomes for both the resource and the workers involved.

*****

Formation of Coal India Limited

In the 1970s, the Indian government implemented a national energy policy that led to significant control over coal mines in the country. This happened in two main steps. First, on October 16, 1971, the government passed the Coking Coal Mines (Emergency Provisions) Act of 1971. This act allowed the government to take over the management of all 226 coking coal mines, except those owned by IISCO, TISCO, and DVC. Then, on May 1, 1972, these mines were officially nationalized, meaning they became the property of the government.

So, Bharat Coking Coal Limited came into existence as a result. Then, on January 31, 1973, the Central Government issued the Coal Mines (Taking over of Management) Ordinance 1973. This allowed the government to take control of all 711 non-coking coal mines. Later, on May 1, 1973, these mines were officially nationalized, and a public sector company called Coal Mines Authority Limited (CMAL) was established to manage them.

Coal India Limited

Coal India Limited (CIL), a state-owned coal mining company, was established in November 1975. Despite its humble beginnings with a production of 79 million tonnes (MTs) in its first year, CIL has grown to become the largest coal producer globally and one of the largest employers, with a workforce of 272,445 as of April 1, 2020. CIL operates across 84 mining areas spanning eight states in India.

As of April 1, 2020, CIL owns and operates 352 mines, comprising 158 underground mines, 174 opencast mines, and 20 mixed mines. Additionally, CIL manages 12 coal washeries (10 for coking coal and 2 for non-coking coal) along with various facilities such as workshops and hospitals.

CIL places a strong emphasis on training and skill development, boasting 26 training institutes and 84 vocational training centers. The Indian Institute of Coal Management (IICM), operating under CIL, is a premier management training institute offering multidisciplinary programs and is recognized as the largest corporate training institute in India.

Recognized as a Maharatna company, a prestigious status conferred by the Government of India to select state-owned enterprises, CIL is empowered to expand its operations and compete on a global scale. This elite designation is held by only ten out of over three hundred Central Public Sector Enterprises in the country.

CIL comprises seven producing subsidiaries, including Eastern Coalfields Limited (ECL), Bharat Coking Coal Limited (BCCL), Central Coalfields Limited (CCL), Western Coalfields Limited (WCL), South Eastern Coalfields Limited (SECL), Northern Coalfields Limited (NCL), and Mahanadi Coalfields Limited (MCL). Additionally, CIL has a mine planning and consultancy company, Central Mine Planning & Design Institute (CMPDI), and a foreign subsidiary in Mozambique known as Coal India Africana Limitada (CIAL).

Sure, here’s a table summarizing the important points about Coal India Limited (CIL):

*****

Unmatched Strategic Relevance

Coal India Limited (CIL) plays a crucial role in India’s energy landscape. Here’s how:

• Significant Contribution to Coal Production: CIL is responsible for producing approximately 83% of India’s total coal output. Given that coal fuels around 57% of India’s primary commercial energy needs, CIL alone meets a substantial 40% of the country’s primary commercial energy requirement.
• Continued Importance of Coal: Coal is projected to remain a major energy source in India, comprising about 48-54% of the energy mix until 2040. Additionally, coal accounts for a significant 76% of the total thermal power generating capacity in the utility sector.
• Price Stability: CIL supplies coal at prices discounted compared to international rates. This helps shield Indian coal consumers from the volatility of global prices, ensuring stability in energy costs for various industries.
• Boosting Competitiveness: By providing affordable coal, CIL supports end-user industries, making them more competitive on a global scale. This is particularly crucial for initiatives like “Make in India”, which aim to promote domestic manufacturing and position India as a competitive player in the global market.

*****

Production and Growth

In the fiscal year 2019-20, Coal India Limited (CIL) faced numerous challenges but managed to produce a substantial amount of coal, reaching 91% of its production target. This marked the second time CIL surpassed the 600 million tonnes (MT) milestone in coal production.

A significant achievement occurred on March 30, 2020, when CIL set a new record by producing 3.86 MT in a single day, the highest production since its establishment.

Northern Coalfields Limited and Western Coalfields Limited also outperformed their production targets for the year, achieving 102% and 103% of their respective goals. Northern Coalfields Limited produced 108.05 MT, while Western Coalfields Limited’s production reached 57.64 MT.

During the same period, raw coal off-take amounted to 581.411 MT, with Over Burden Removal (OBR) reaching 1154.33 million cubic meters. The dispatch of coal and coal products for the fiscal year totaled 582.48 MT, with 465.72 MT dispatched to power utilities, including special forward e-Auction.

It’s noteworthy that the overall coal stock at powerhouses reached its highest level in a decade, standing at 45.01 MT (equivalent to 28 days of consumption) as of March 31, 2020.

Sure, here’s a concise table summarizing the key production and performance metrics for Coal India Limited (CIL) during the fiscal year 2019-20:

****

Top Projects: Expansion Plans and Progress in Coal Production

Currently, there are 107 mining projects actively underway, collectively capable of producing 625.91 million tonnes (MT) of coal per year. These projects contributed 295.37 MT of coal production during the year 2019-20. Additionally, there are 141 completed mining projects with an annual capacity of 300.12 MT.

Looking ahead, there are plans for 49 new future projects to be initiated, aiming to further boost coal production. These projects have a targeted capacity of 485.84 MT and are expected to contribute towards Coal India Limited’s goal of achieving 1 billion tonnes of coal production by the fiscal year 2023-24.

**

Clean Coal Technology

In pursuance to initiatives towards development of Clean Coal Technology and alternate use of coal, CIL is exploring the possibilities to venture into the Coal-to-Chemicals sector on stand-alone basis by setting up a Coal-to-Methanol plant at Dankuni Coal Complex (DCC). Coal sourced from Raniganj coalfields shall be gasified to produce syngas which shall be subsequently converted into methanol.

Consumer Satisfaction

Consumer satisfaction is priority area for CIL and for enhanced consumer satisfaction special emphasis has been given to Quality Management of Coal from mine to dispatch point. All consumers of CIL have the option for quality assessment through independent third party sampling agencies. A portal ‘UTTAM’ has been launched by CIL to so that information of coal quality will be accessible to both coal companies and consumers.

Acquisition of Coal Assets Abroad

Coal India Limited (CIL) is currently engaged in acquiring, developing, and operating coking coal assets in the Far East Region of Russia. This endeavor took a significant step forward with the signing of a bilateral Memorandum of Understanding (MOU) between CIL and the Far East Investment & Export Agency (FEIEA), a Russian government agency. The MOU was signed on September 4, 2019, in the presence of the Prime Minister of India and the President of the Russian Federation, during a ceremony held in Vladivostok.

Community Engagement: Coal Mining and Social Responsibility

Coal mining in India often occurs in areas inhabited by tribal communities or situated on forest land, making it a sensitive issue. The displacement of people is an inevitable consequence of coal mining activities. However, Coal India Limited (CIL) has developed a comprehensive Rehabilitation and Resettlement Policy for Project Affected People (PAP).

CIL adopts a “Mining with a Human Face” approach, prioritizing socially sustainable and inclusive growth. This involves actively involving the Project Affected People in decision-making processes related to their livelihoods. By making them stakeholders in the process, CIL strives to mitigate the impact of coal mining on the lives of those directly affected by its operations.

Environmental Stewardship: Sustainable Coal Mining

Coal mining often leads to environmental degradation, posing significant challenges to natural resources. Recognizing this, Coal India Limited (CIL) adopts a responsible approach to mining, emphasizing sustainable practices.

A holistic framework is implemented to minimize and mitigate the environmental impact of coal mining activities. CIL is committed to addressing environmental concerns through concerted efforts aimed at preserving and protecting the environment.

Environmental Conservation: Tree Plantation Initiatives

Coal India Limited (CIL) is committed to fostering harmony with the environment while ensuring sustainable coal mining practices. As part of this commitment, extensive tree plantation programs are conducted annually across various locations.

CIL’s tree plantation efforts encompass a wide range of areas, including overburden (OB) dumps, haul roads, mine surroundings, residential colonies, and other available land. Till March 2020, CIL has planted a remarkable 99.6 million trees, covering an expansive area exceeding 39,842 hectares.

In the fiscal year 2019-20 alone, CIL planted 1.98 million trees, covering an area of 812.98 hectares. For FY2020-21, the company aims to further its tree plantation endeavors by targeting the planting of over 1.8 million native and local species across approximately 740 hectares of land.

Additionally, CIL has forged partnerships with esteemed Indian scientific institutions such as the Indian Council of Forestry Research and Education (ICFRE) and the National Environmental Engineering Research Institute (NEERI). These collaborations involve scientific studies and support the development of eco-restoration sites, including the implementation of three-tier plantation schemes using native species.

• CIL prioritizes environmental harmony and sustainable coal mining.
• Annual tree plantation programs cover various areas.
• 99.6 million trees planted till March 2020, spanning 39,842 hectares.
• In FY 2019-20, 1.98 million trees planted across 812.98 hectares.
• FY 2020-21 targets over 1.8 million native species across 740 hectares.
• Partnerships with ICFRE and NEERI for scientific studies and eco-restoration.
• Three-tier plantation schemes implemented with native species.

Certifications at CIL Headquarters and Subsidiaries

Coal India Limited (CIL) Headquarters has received certification for ISO 9001 (Quality Management), ISO 14001 (Environment Management), and ISO 50001 (Energy Management System) from the Bureau of Indian Standards (BIS).

As of March 31, 2019, four CIL subsidiaries – ECL, CCL, NCL, and MCL – are certified for an Integrated Management System covering ISO 9001, ISO 14001, and OHSAS 18001 (Occupational Health and Safety Management System).

Additionally, CMPDI Headquarters and its seven Regional Institutes are certified for ISO 9001:2015 (Quality Management System).

Energy Conservation Initiatives

Coal India Limited (CIL) prioritizes energy conservation, implementing various measures to reduce specific energy consumption.

• High-wattage conventional light fittings have been replaced with low-power LED lights in street lighting, offices, workplaces, and townships.
• A comprehensive energy audit of CIL’s office building and adjacent residential complex was conducted by CMPDI in 2018-19.
• As a result of the audit, the contract demand for the office building was reduced from 1450 KVA to 1200 KVA, and for the residential complex from 500 KVA to 250 KVA.
• These revised contract demands were implemented in October 2019, leading to an 11% reduction in the electricity bill for the office building and a significant 30% reduction for the residential premises.

Solar Power Utilization

Coal India Limited (CIL) has implemented various initiatives to harness solar power as an alternative energy source. One successful endeavor includes the operation of kilowatt-scale rooftop solar plants.

Subsidiary-wise installation capacities for rooftop solar plants are as follows:

ECL: 197 kWp
BCCL: 6 kWp
CCL: 872.5 kWp
WCL: 1097 kWp
Coal India Office, Kolkata: 160 kWp
CMPDIL HQ and Regional Institutes: 500 kWp

In the fiscal year 2019-20, these plants collectively generated a total of 24.469 lakh kWh of electricity.

Enterprise Resource Planning (ERP) Implementation

Coal India Limited (CIL) is undergoing the design and implementation of a robust Enterprise Resource Planning (ERP) and Hospital Management system across CIL and its subsidiaries.

• The objective is to integrate all facets of business operations into a user-friendly system.
• This system aims to efficiently plan, manage, and optimize organizational resources by standardizing business processes and adopting best practices.
• Phase-I of the project, known as ‘Project Passion’, is currently in the realization stage.

CIL is actively working towards the early implementation of SAP ERP at ECL, BCCL, CCL, CMPDI, NCL, and SECL as part of Phase II.

Improving Project Monitoring Systems

Coal India Limited (CIL) has undertaken initiatives to enhance project monitoring capabilities through the development and implementation of advanced systems.

WEB-Based Online Monitoring System

CIL has developed a WEB-Based Online Monitoring System to effectively oversee the implementation of coal projects. This system enables real-time monitoring and tracking of project progress. Currently, 82 coal mining projects, with a cumulative cost of Rs. 150 Crores, are being monitored using a server-based MS Project platform. This ensures efficient management of project timelines, budgets, and resources.

MDMS Portal

In addition to the WEB-Based Online Monitoring System, CIL utilizes the Mine Data Management System (MDMS) Portal for monitoring its ongoing projects. This portal serves as a centralized platform for collecting, analyzing, and reporting project-related data. By leveraging the MDMS Portal, CIL can enhance transparency, accountability, and decision-making in project management processes.

These system improvements enable CIL to maintain a proactive approach to project monitoring, ensuring timely execution and successful completion of coal mining projects.

Ensuring Safety at Coal India Limited

Commitment to Safety

Safety stands as the cornerstone of operations at Coal India Limited (CIL), reflecting the company’s deep-rooted commitment to safeguarding its workforce. This commitment is echoed in CIL’s mission statement, where safety is accorded the utmost importance.

Well-Defined Safety Policy

CIL has established a comprehensive Safety Policy to uphold safety standards across its mining operations. This policy serves as a guiding framework, outlining the company’s approach to ensuring the safety and well-being of its employees working in mines.

Advancing First Mile Connectivity

Transition to Mechanized Coal Transportation

Coal India Limited (CIL) is embarking on a significant transition towards mechanized coal transportation through piped conveyor belts in its larger mines by the fiscal year 2023-24. This shift aims to replace the conventional method of road transport for coal. The company has already initiated the necessary steps to facilitate this transition.

Identified Coal Projects

To facilitate this transition, CIL has identified thirty-five coal projects, each with a production capacity of 4 million tonnes per annum or more. These projects will serve as focal points for implementing mechanized coal transportation, thereby streamlining the coal supply chain.

Environmental Safety and Prevention of Coal Pilferage

This strategic move not only promotes environmental safety but also mitigates the risk of potential coal pilferage. By eliminating the need for road transport, the likelihood of coal theft and unauthorized handling is significantly reduced.

Benefits of Mechanized Loading

Moreover, the adoption of mechanized loading of coal offers numerous advantages. It enables processes such as crushing and sizing of coal, leading to quicker and more efficient loading. Additionally, pre-weighed coal loading ensures consistent quality, enhancing overall operational efficiency and product quality.

Looking Ahead: Coal India Limited’s Vision

Contributing to National Energy Security

Coal India Limited (CIL) is dedicated to playing a pivotal role in bolstering the nation’s energy security. Recognizing the significance of coal in meeting the country’s energy needs, CIL is steadfast in its commitment to ensuring a reliable and sustainable coal supply.

Roadmap for Future Growth

In line with the demand projections outlined in ‘Vision 2024’ for the coal sector in India, CIL has charted a comprehensive roadmap for the future. This roadmap entails a bold vision of achieving a coal production milestone of 1 Billion Tonnes (Bt) by the year 2023-24, thereby meeting the burgeoning coal demand of the nation.

Strategic Planning and Project Identification

To realize this ambitious target, CIL has meticulously identified major projects and assessed various associated challenges. By proactively addressing these issues and implementing strategic initiatives, CIL aims to streamline operations and enhance productivity, ultimately contributing significantly to the nation’s energy security and economic growth.

Coal India Limited: Milestone and Key Development

A formal holding company in the form of Coal India Limited was formed in November 1975 to manage both the companies.

Major Events and Milestones :

2024

Boost in Coal Production and Dispatches in India for April 2024

In April 2024, India’s coal production saw a significant rise, reaching 78.69 million tonnes (MT), which marks a 7.41% increase from the previous year’s 73.26 MT. Coal India Limited (CIL), the major player, contributed 61.78 MT to this figure, up by 7.31% from last April’s production of 57.57 MT. Additionally, other producers and captive miners reported a production of 11.43 MT, achieving an impressive 12.99% growth compared to 10.12 MT in the same month of the previous year.

Furthermore, coal dispatches in April 2024 also witnessed an upward trend, totaling 85.10 MT, a 6.07% rise from the 80.23 MT dispatched in the same month last year. Of this, CIL’s dispatches accounted for 64.26 MT, growing by 3.18% compared to April of the previous year. Notably, dispatches from captive and other miners reached 15.16 MT, showing a substantial increase of 26.90% from the previous year’s 11.95 MT.

2023

• Record Growth: Among the eight core industries, India’s coal sector achieved a remarkable growth of 18.4% in October 2023.
• Coal Production: Coal production is likely to cross one billion tonnes in 2023-2024. As of 25th December 2023, coal production reached 664.37 million tonnes.
• Coal Dispatch: Coal dispatch to the power sector grew by 8.39%, reaching 577.11 million tonnes.
• Commercial Coal Mine Auction: The 9th round of commercial coal mine auction was launched, offering 31 mines across Jharkhand, Chhattisgarh, Madhya Pradesh, and Telangana.
• First Mile Connectivity Projects: 31 First Mile Connectivity Projects were commissioned for more efficient coal movement.
• Railway Projects: Four railway projects were commissioned for faster coal movement.
• Corporate Social Responsibility: Coal India Ltd undertook major projects under Corporate Social Responsibility in 2023.
• Policy Initiatives & Reforms: A series of policy initiatives and reforms were undertaken to enhance overall coal production and supply, focus on environment-friendly underground coal production, curtail imports to a minimum, and promote coal gasification projects.

2019-20

Coal Production Milestones

Record-Breaking Production

In the fiscal year, Coal India Limited (CIL) achieved a remarkable coal production figure of 602.13 Million Tonnes (MTs). This achievement marks the second consecutive year where CIL has surpassed the 600 million tonne mark, showcasing its sustained growth and efficiency in coal production.

March 2020: Highest Monthly Production

March 2020 witnessed a significant milestone for CIL, with a record-breaking monthly production of 84.36 MT. This remarkable feat represents the highest monthly coal production since the inception of the company, underscoring CIL’s dedication to maximizing output.

Coal Stock Levels

Furthermore, as of March 31, 2020, the coal stock at powerhouses reached its highest level in a decade, totaling 45.01 MT (equivalent to 28 days’ usage). This surplus in coal stock provides a buffer against potential supply disruptions and reflects CIL’s efforts to ensure adequate coal reserves for power generation.

2018-19

Coal Production and Corporate Partnership

Record-Breaking Performance

In a significant milestone, Coal India Limited (CIL) surpassed the 600 Million Tonne (MT) mark in both coal production and off-take for the first time, concluding the fiscal year 2019 on a high note. CIL produced a remarkable 606.89 MTs of coal and supplied 608.14 MTs, representing growth rates of 6.97% and 4.8% respectively over the previous year. This achievement underscores CIL’s consistent growth and efficiency in meeting the nation’s coal demand.

Corporate Partnership with International Solar Alliance (ISA)

Furthermore, CIL solidified its commitment to sustainability and renewable energy by aligning itself as a corporate partner of the International Solar Alliance (ISA). As a demonstration of its support, CIL contributed 1 Million US Dollars (approximately Rs. 6.75 Crores) to ISA’s corpus fund. This initiative highlights CIL’s proactive engagement in global efforts to promote solar energy and combat climate change.

2017-18

Enhanced Project Monitoring Systems

WEB-Based Online Monitoring System

To bolster project oversight, Coal India Limited (CIL) implemented a WEB-Based Online Monitoring System in the fiscal year 2016-17. This system enables the monitoring of 69 coal-mining projects with a cost exceeding Rs.150 Crores. Utilizing project monitoring software such as MS Project, CIL can track project progress and ensure timely completion within budgetary constraints. This initiative enhances transparency and accountability in project management, facilitating informed decision-making processes.

Mine Data Base Management System (MDMS)

In collaboration with the Central Mine Planning and Design Institute (CMPDI), CIL introduced the Mine Data Base Management System (MDMS). This portal is dedicated to monitoring ongoing projects with a budget of Rs. 20 Crores and above within CIL. By centralizing project data and providing real-time insights, MDMS empowers CIL to effectively manage project lifecycles, identify potential bottlenecks, and optimize resource allocation. This initiative represents CIL’s commitment to leveraging technology for efficient project management and continuous improvement.

2016-17

Achieving Quality and Production Milestones

ISO Certifications

On October 27, 2016, Coal India attained prestigious certifications, including IS/ISO 9001:2015 for its Quality Management System and IS/ISO 50001:2011 for its Energy Management System. These certifications reflect Coal India’s commitment to upholding high standards of quality and efficiency across its operations.

Historic Production Achievement

Coal India celebrated a significant milestone as its production and off-take surpassed the Half-a-Billion Tonne mark for the first time. This remarkable achievement underscores Coal India’s position as a leading player in the coal industry.

Record-Breaking Production in FY 2016

In the fiscal year 2016, Coal India achieved record-breaking coal production, totaling 538.75 Million Tonnes (MTs) across its operations. This achievement represented a substantial increase of nearly 44.51 MTs compared to the previous fiscal year. Notably, this marked the highest incremental increase in coal production recorded in a single financial year since the establishment of the company. This exceptional performance demonstrates Coal India’s unwavering dedication to meeting the nation’s coal demand while striving for continuous growth and excellence.

2015-16

Achieving Financial Milestones

Record Gross Sales

In a historic achievement, Coal India surpassed the monumental milestone of Rs. 1 Lakh Crores in Gross Sales for the first time. During the fiscal year 2015-16, Coal India recorded Gross Sales amounting to Rs. 1,08,150.03 Crores. This remarkable accomplishment underscores Coal India’s significant role as a leading player in the coal industry, contributing substantially to the nation’s economy.

Significant Contribution to Government Revenue

Coal India continued its tradition of being one of the highest contributors to both federal and state government revenues in the country. In the fiscal year 2016, Coal India made a substantial corporate tax payment of Rs. 7,012.35 Crores to the Government of India. This contribution further highlights Coal India’s commitment to supporting government initiatives and bolstering economic development through its operations in the coal sector.

2014-15

Corporate Achievements and Contributions

Emergence from BIFR and Mini Ratna Status

Eastern Coalfields Limited (ECL) emerged from the shadows of the Board for Industrial and Financial Reconstruction (BIFR), signifying its recovery and revitalization. Similarly, Bharat Coking Coal Limited (BCCL) achieved the prestigious Mini Ratna status, recognizing its excellence and efficiency in operations.

Significant Contribution to Government Revenues

Coal India Limited (CIL) stands as one of the foremost contributors to both federal and state government coffers across the country. In the fiscal year 2014-15, CIL made a substantial corporate tax payment of Rs. 9,572.05 crores to the Government of India. This notable contribution represents one of the highest cash payouts within the Indian corporate sector, reflecting CIL’s significant role in supporting government initiatives and bolstering economic development.

2013-14

Noteworthy Recognition in Media

Government Support and Financial Contribution

In 2013-14, Coal India Limited (CIL) garnered widespread praise in the media, being dubbed as ‘the jewel in the government’s PSU Crown.’ The company’s robust financial position and substantial cash reserves were highlighted, positioning CIL as a key player in supporting government initiatives and addressing fiscal challenges. Particularly noteworthy was CIL’s declaration of the highest interim dividend for the fiscal year 2013-14, signaling its significant financial contribution to boost government coffers during that period.

2012-13

Coal India Limited was named ‘Platts Top 250 Global Energy Company Rankings’ for 2012 for having distinguished itself through its remarkable performance last year. Since, 2002 platts has ranked energy companies ‘financial performance globally, regionally and by industry sector. For 2012 CIL’s rank was 48 on overall global performance.

CIL ranked No.2 in Coal and Consumable Fuels in Asia/Pacific Rim; also No.2 in Coal and Consumable Fuel globally and No. 11 in overall performance in Asia/Pacific Rim.

Coal India Limited was conferred with ‘Best Geospatial Application in an Enterprise’ Award, on 22 January 2013 by Geospatial Media and Communications Pvt. Ltd.

2011-12

Elevation to ‘Maharatna’ Status

Government Recognition and Empowerment

On April 11, 2011, Coal India Limited (CIL) achieved a significant milestone by being conferred with the prestigious ‘Maharatna’ status by the Government of India. This designation elevated CIL’s stature, making it one of the elite few among Central Public Sector Enterprises (CPSEs) in the country. Among the 215 CPSEs, CIL was only the fifth to attain this esteemed status.

Introduction of the Maharatna Scheme

The ‘Maharatna’ scheme was introduced by the Government of India in February 2010, aimed at empowering select mega CPSEs to expand their operations and emerge as global leaders in their respective sectors. This initiative underscores the government’s vision to promote growth and competitiveness among CPSEs on a global scale.

Criteria and Objectives

The Maharatna scheme entails delegating enhanced powers to the Boards of identified large Navratna CPSEs that fulfill specific criteria. These criteria include performance parameters related to financial performance, international operations, and strategic investments. The primary objective of the Maharatna status is to facilitate the expansion of CPSEs’ operations, both domestically and globally, by granting them greater autonomy and flexibility in decision-making processes.

Through this empowerment, CPSEs like CIL are better positioned to capitalize on emerging opportunities and contribute significantly to India’s economic growth and global competitiveness.

Inclusion in Sensex: A Rapid Ascent

Significant Achievement and Economic Indicator

Coal India Limited (CIL) achieved a remarkable milestone on August 8, 2011, when it was included in the prestigious 30-stock Sensex. The Sensex is globally recognized as a key indicator of the Indian economy’s performance. This accomplishment is particularly noteworthy as it occurred within a short span of nine months since CIL’s listing on November 4, 2010.

Unprecedented Speed of Inclusion

What sets CIL’s inclusion apart is the unprecedented speed at which it rose to prominence within the Sensex. No other company had achieved inclusion in the index in such a brief timeframe. Even more impressive was CIL’s ascent to the top tier of the Sensex, which occurred in just seven trading sessions following its initial inclusion. This rapid rise underscored CIL’s strong performance and market impact, marking it as a notable achievement in the corporate world.

Most Valued Company in the country

On 17 August 2011, Coal India emerged as the Most Valued Company in the country in terms of Market Capitalization – the pinnacle of success every business entity dreams of and aspires for. The company’s value stood at a whopping Rs.2,51,296 Crores. What made the achievement all the more significant was that a public sector company could attain such lofty heights.

Exploring Green Energy Solutions: CMPDI’s Participation in GHG2E Project

Introduction to the Project

The Central Mine Planning and Design Institute (CMPDI), a subsidiary of Coal India Limited based in Ranchi, has been selected to collaborate on the Green House Gas recovery from coal mines and un-mineable coal beds and conversion to energy (GHG2E) project. This initiative, funded by the European Union, aims to address methane emissions from coal mines while maximizing the utilization of methane as an energy source.

Objectives and Scope

The primary objective of the GHG2E project is to contribute to global greenhouse gas reduction efforts by controlling methane emissions from coal mines and effectively harnessing the produced methane for energy generation. Specifically, the Moonidih and Sudamdih mines of Bharat Coking Coal Limited (BCCL) have been identified as research sites for this project. The project is scheduled to span a total duration of 42 months.

Project Initiation and Collaboration

Officials from CMPDI actively participated in the project’s kick-off meeting held in Slovakia from October 6th to 9th, 2011. Additionally, a team comprising Professor Sevket Durucan from Imperial College of Engineering, London, and Professor K. Pathak from the Indian Institute of Technology, Kharagpur, along with representatives from both institutions, visited CMPDI on November 16th, 2011. Detailed discussions were held regarding the project’s implementation, and the team, accompanied by CMPDI officials, visited Moonidih mine and BCCL for further discussions.

Financial Support and Progress

CMPDI has received an advance payment of EURO 47,867.35 for its involvement in the GHG2E project, highlighting the financial backing and commitment to its success. This collaborative effort between CMPDI, academic institutions, and industry partners signifies a concerted approach towards exploring sustainable energy solutions and mitigating environmental impact in coal mining operations.

Wage Agreement Finalized by Coal India Limited

Coal India Limited (CIL) successfully finalized a wage agreement on January 31, 2012, for its 363,000 non-executive employees, granting them a 25% increase based on their gross wages as of June 30, 2011. This wage hike is retroactively effective from July 1, 2011, and will extend over a five-year period. This marks the second occasion where Coal India leads as the first Central Public Sector Undertaking in India to conclude a wage negotiation successfully.

Impressively, the Ninth National Coal Wage Agreement (NCWA IX) was completed in just six months following the establishment of the Joint Bipartite Committee for the Coal Industry (JBCCI) in August 2011, setting a record for the quickest conclusion of wage negotiations in CIL’s history.

2010-11

Performance Targets Set in Coal India’s MoU with Ministry of Coal

On March 31, 2011, Coal India Limited (CIL) signed a Memorandum of Understanding (MoU) with the Ministry of Coal, outlining its key performance areas for the fiscal year 2011-12. According to the MoU, CIL has set ambitious targets for coal production and off-take at 452 million tonnes and 454 million tonnes, respectively, aiming to achieve an ‘Excellent’ rating. Notably, this follows a streak where CIL achieved an ‘Excellent’ rating for three consecutive fiscal years—2007-08, 2008-09, and 2009-10—underscoring its consistent performance and commitment to meeting high standards.

Enhanced Focus and New Goals in Coal India’s 2011-12 MoU

The Memorandum of Understanding (MoU) for the fiscal year 2011-12 signed by Coal India Limited (CIL) places special emphasis on several key areas: Research & Development, Corporate Social Responsibility (CSR), Sustainable Development, and Corporate Governance. These have been designated as major focus areas. To meet its ambitious coal off-take target for the year, CIL has requested the provision of 175 railway rakes per day.

This is an increase from the average availability of 156.8 rakes per day in the previous fiscal year and 161.9 rakes per day in the current year. Despite an average growth in coal transportation via rail of only about 2% over the last three years, CIL has set a significant growth target of approximately 13.5% through rail to achieve the stipulated off-take goals.

Strategic Developments and Achievements at Coal India Limited

R&D and CSR Initiatives

Over the past year, Coal India Limited (CIL) has significantly increased its investment in research and development (R&D). The expenditure on R&D activities jumped from approximately Rs. 15 crores annually in 2009-10 to Rs. 30 crores in 2010-11. Additionally, CIL has also increased its expenditure on Corporate Social Responsibility (CSR) activities, aligning with guidelines from the Department of Public Enterprises (DPE).

International Recognition

On March 7, 2011, CIL achieved international acclaim by winning its first-ever “Century International Quality ERA Award (CQE)” in the Gold category at a ceremony in Geneva. This award was presented by Business Initiative Directions (BID), recognizing CIL’s commitment to Quality, Leadership, Technology, and Innovation. The award highlights CIL’s status as a symbol of India’s success in the global business landscape.

ADVERTISEMENT

Joint Venture for Logistic Solutions

In December 2010, CIL signed a Memorandum of Understanding with The Shipping Corporation of India Limited to promote a Joint Venture Company (JVC). This JVC aims to provide an end-to-end logistic solution covering everything from load port to the consuming end.

This initiative is particularly crucial as it intends to match the service quality of imported coal, which is currently provided with comprehensive quality and quantity assurance, unlike the indigenous coal whose terms of sale are Free on Rail at Colliery.

Objectives of the JVC include:

• Owning or chartering vessels.
• Conducting draft surveys.
• Inspecting cargo.

Managing stevedoring at unloading ports in India, including vessel unloading, customs clearance, shore clearance, and stacking.

Indenting wagons from railways, loading wagons, conducting quality analysis, and delivering coal at power stations.

CIL’s IPO and Public Offering

CIL’s initial public offering (IPO) was another milestone, closing on October 21, 2010. It marked a significant event that demonstrated CIL’s value and potential. Following extensive promotional efforts across India and international markets including the US and Europe, the IPO was a resounding success. On its first day of trading on November 4th, CIL’s shares opened at Rs. 291 and closed at over Rs. 342, symbolizing the national asset being offered to the public as ‘people’s ownership’ in public sector undertakings (PSUs). This day, along with the closure of the IPO, is considered historic in the annals of Coal India Limited.

Record-Breaking Success of Coal India’s IPO

Coal India Limited’s (CIL) initial public offering (IPO) set a new benchmark as the largest ever in the Indian capital market, being oversubscribed by 15.3 times. This monumental achievement generated an unprecedented aggregate fund inflow of Rs. 2,35,276.55 crores, a figure unheard of in the history of Indian capital markets.

The enthusiasm for CIL’s shares spanned across all major investor segments, including Qualified Institutional Buyers (QIBs), High Net-Worth Individuals (HNIs), and retail investors. Remarkably, QIBs, who were allotted 50% of the net issue, subscribed 24.62 times over their quota. This segment alone attracted investments over US$ 38 billion (approximately Rs. 1,71,469.64 crores), setting an all-time high for any Indian IPO.

In the retail segment, the IPO drew nearly 16.36 lakh applications, making it the most subscribed among all public sector unit (PSU) IPOs to date, with funds amounting to Rs. 63,639.26 crores. Notably, foreign investors contributed around US$ 27 billion, equivalent to the first ten months of Foreign Institutional Investor (FII) investments in India for that year, showcasing strong international confidence in CIL.

Adding to its accolades, CRISIL, India’s leading credit rating agency, assigned a maximum grading of 5 to CIL’s IPO. This top-tier grading reflects the strong fundamentals of the IPO compared to other listed securities in the country, highlighting its robust appeal to investors.

2009-10

Recent Achievements and Milestones of Coal India Limited

Scope Excellence Award

Coal India Limited was honored with the prestigious Scope Excellence Award for the fiscal year 2007-08. This award is presented by the Standing Conference of Public Enterprises (SCOPE) and recognizes outstanding performance among public enterprises in India.

International Expansion

In a significant move towards global expansion, Coal India established Coal India Africana Limitada, a foreign subsidiary in Mozambique. This strategic establishment aims to facilitate coal mining operations abroad and enhance Coal India’s presence in the international market.

Transition to a Public Limited Company

Coal India Limited achieved another significant milestone by converting from a private entity into a public limited company. This transformation has allowed for greater transparency and efficiency in operations, aligning with global corporate practices.

Recognition as ‘Mini Ratna’

The Central Mine Planning and Design Institute Limited (CMPDIL), a subsidiary of Coal India Limited, was awarded the ‘Mini Ratna’ status by the Department of Public Enterprises, Government of India. This status is conferred to public sector enterprises that have shown commendable operational efficiency and competitiveness in their respective fields.

Receipt by the Company of a composite score of 1.47 and rating as “excellent” for the year 2007-2008 by Department of Public Enterprises, Ministry of Heavy Industries & Public Enterprises, GoI.

2008-09

Award of ‘Navratna’ status to the Company by the Department of Public Enterprises, GoI, for the operational efficiency and financial strength, which affords greater operational freedom and autonomy in decision making.

Overall production of coal by the Company and our Subsidiaries, crossed 400 million tonnes.

2007-08

Award of ‘Mini Ratna’ status by the Department of Public Enterprises, GoI, to CCL.

2006-07

Award of ‘Mini Ratna’ status by the Department of Public Enterprises, GoI, to our Company and to MCL, NCL, SECL and WCL.

Decline in debt as a percentage of net worth from 66 % in 2001-2002 to 10 % in 2006 -2007.

2005-06

Rating of ‘AAA/Stable’, indicating highest degree of safety with regard to timely payment of interest and principal, awarded by CRISIL in respect of the Rs. 250 million bond programme of our Company.

Introduction of sale of coal through ‘e-auction method’;

ECL and BCCL reported profit of Rs. 3,638 million and 2,026.67 million in Fiscal 2006.

2003-04

Overall production of coal by the Company and our Subsidiaries crosses 300 million tonnes.

2001-02

Laying down of a minimum internal rate of return of 12% at 85% capacity utilization as cut off for the development of a project.

1997-98

Strategic Financial Restructuring and International Funding at Coal India Limited

Financial Restructuring Between Company and Subsidiaries

Coal India Limited has restructured the financial flows between the parent company and its subsidiaries. Under the new arrangement, the parent company will primarily receive dividends from its subsidiaries as per the applicable policies. The company’s corpus is now designated to strategically support loss-making entities, specifically for maintaining their productive capital assets. This approach aims to stabilize and enhance the operational efficiency of underperforming subsidiaries.

International Loans for Expansion Projects

Coal India Limited secured a significant loan amounting to USD 1.03 billion from the World Bank and the Japanese Bank for International Cooperation. This funding is dedicated to implementing 24 highly viable open-cast mining projects, which include global sourcing of equipment. Between Fiscal Years 1998 and 2004, USD 484.40 million of this loan was utilized. This financial infusion has facilitated the expansion and modernization of Coal India’s mining operations, incorporating advanced global technologies and equipment.

1996-97

Financial Strategies and Regulatory Changes at Coal India Limited

CRISIL ‘A+’ Rating for Bond Issue

Coal India Limited’s bond issue of Rs. 4,000 million was awarded an ‘A+’ rating by CRISIL, indicating adequate safety concerning the timely payment of interest and principal. This high rating reflects the financial robustness and creditworthiness of Coal India Limited, providing investors with confidence in the stability of their investments.

Adoption of Financial Viability for Project Approvals

Coal India Limited has adopted financial viability as the primary criterion for approving coal development projects. This approach ensures that all new projects are economically feasible and are expected to contribute positively to the company’s financial health and strategic growth objectives.

Regulatory Changes in Coal Pricing

The company has also seen significant regulatory changes, with the discontinuation of the retention prices scheme and the Coal Price Regulation Account (CPRA). This move has led to the deregulation of prices for certain grades of coal, allowing Coal India Limited to adjust coal prices based on market conditions and operational costs, thereby enhancing flexibility and responsiveness to market dynamics.

1995-96

Government-Approved Financial Restructuring and Profit Achievement at Coal India Limited

Comprehensive Financial Restructuring Package

The Government approved a significant financial restructuring package for Coal India Limited, which included several key financial adjustments to enhance the company’s financial stability. This package involved the waiver of Rs. 8,917 million in interest liabilities and the conversion of Rs. 9,041.8 million in plan loan repayment arrears into preference equity.

Additionally, Rs. 4,326.4 million in non-plan payment arrears were granted a moratorium on repayments and interest accrual for three years. These arrears are scheduled to be repaid in three equal installments after the moratorium period, easing the company’s immediate financial burden and improving its long-term financial health.

Profitable Fiscal Year

In Fiscal 1996, Coal India Limited reported a substantial profit of Rs. 6,116 million. This financial success underscores the company’s operational efficiency and effective management during that fiscal year, reflecting its ability to generate significant earnings amidst the challenges and dynamics of the coal industry.

1992-93

Establishment of MCL as a Subsidiary in Orissa

Coal India Limited expanded its operations by forming Mahanadi Coalfields Limited (MCL) as a subsidiary. MCL was established to manage the coal mines located in Talcher and the IB Valley in the state of Orissa. This strategic move was aimed at enhancing the management and operational efficiency of these key mining regions, ensuring better resource allocation and more focused regional development.

1991-92

Key Financial and Operational Milestones for Coal India Limited

Profit Growth Beginning in 1991

Starting in 1991, Coal India Limited began a period of increasing profitability, culminating in a profit of Rs. 1,670 million in Fiscal 1992. This uptrend in profit highlighted the company’s successful strategies and operational improvements during this period.

Surpassing Coal Production Targets

Coal India Limited and its subsidiaries achieved a significant production milestone by collectively surpassing 200 million tonnes of coal. This achievement underscores the company’s substantial contribution to meeting the energy needs of the nation and its capability in large-scale coal production.

Annual Coal Pricing Strategy

Coal India Limited implemented a new pricing strategy, deciding to fix coal prices once a year. This approach compensates for the increase in the cost of inputs based on a normative cost basis. Additionally, the company adopted an escalation formula prescribed by the Bureau of Industrial Cost and Prices (BICP). This method ensures that pricing adjustments are made systematically and are in line with economic conditions, supporting sustainable financial performance.

1987-88

Introduction of Blasting Gallery Method in Coal Mines

Coal India Limited has implemented the ‘Blasting Gallery Method’ at two of its mining sites to enhance coal extraction efficiency. This advanced technique was introduced at the East Katras mine under Bharat Coking Coal Limited (BCCL) and at the Chora mine under Eastern Coalfields Limited (ECL). The adoption of this method marks a significant step in improving the safety and productivity of coal mining operations by allowing for more controlled and effective blasting processes.

1985-86

ADVERTISEMENT

Creation of NCL and SECL as Subsidiaries for Enhanced Mine Management

Coal India Limited expanded its operational structure by establishing Northern Coalfields Limited (NCL) and South Eastern Coalfields Limited (SECL) as subsidiaries. These new entities were formed to manage specific mines that were previously overseen by Western Coalfields Limited (WCL) and Central Coalfields Limited (CCL).

The formation of NCL and SECL aimed to optimize the management and operational efficiency of these mines, facilitating more focused administrative attention and specialized resource management in these regions.

1981-82

Introduction of Retention Prices for Coal

On March 31, 1982, an amendment to the Colliery Control Order of 1945 was enacted through a government notification, introducing retention prices for coal. This regulatory change was specifically aimed at the subsidiaries of Coal India Limited. Retention prices are set to ensure that coal producers can retain a portion of the revenue to cover essential operational costs and investments.

This policy was implemented to stabilize the coal market, encourage sustained coal production, and ensure the financial viability of coal mining operations.

1980-81

Expansion with New Coal Washeries and Production Milestone

Construction of New Washeries

Coal India Limited has significantly expanded its infrastructure by constructing five new coal washeries. These facilities, located at Moonidih, Ramgarh, Mohuda, Barora, and Kedla, are designed to enhance the quality of coal by removing impurities and improving its market value. The addition of these washeries supports Coal India’s commitment to efficiency and environmental sustainability in coal processing.

Surpassing 100 Million Tonnes in Coal Production

Coal India Limited and its subsidiaries achieved a significant milestone by collectively producing over 100 million tonnes of coal. This achievement not only demonstrates the company’s substantial operational capacity but also its pivotal role in supporting the energy sector and economic growth through robust coal production.

1979-80

Strategic Developments in Coal Processing and Pricing

Construction of Low Temperature Carbonization Plant

The construction of a new low temperature carbonized (LTC) plant has commenced at the Dankuni Coal Complex. This facility is designed to process coal into coke at lower temperatures, which helps in preserving more of the volatile components, improving the quality of the resultant coke. This development is part of Coal India Limited’s initiative to enhance product offerings and increase efficiency in coal utilization.

Revision of CMPDIL Pricing Policy

The pricing policy of Central Mine Planning and Design Institute Limited (CMPDIL), a subsidiary of Coal India Limited, has been reviewed and updated. Previously operating on a “no profit no loss” basis, the revised policy aims to ensure that CMPDIL works on commercial lines. This change is intended to improve financial sustainability and align CMPDIL’s operations with market-driven practices, thereby enhancing its competitive edge in the industry.

1975-76

Corporate Rebranding and Structural Expansion at Coal India

Rebranding to Coal India Limited

The company formerly known under a different name officially changed its designation to ‘Coal India Limited’. This rebranding reflects the organization’s evolving identity and its commitment to representing India’s coal industry prominently on both a national and international stage.

Expansion Through Incorporation of Subsidiaries

Coal India Limited has significantly expanded its operational structure through the incorporation of several subsidiaries. Central Mine Planning and Design Institute Limited (CMPDIL), Eastern Coalfields Limited (ECL), and Western Coalfields Limited (WCL) were established as new entities. Additionally, Bharat Coking Coal Limited (BCCL) and Central Coalfields Limited (CCL) were formed. This strategic expansion enables more focused and efficient management of various coalfields and enhances the company’s overall capacity to meet the growing demands of the energy sector.

1973-74

Nationalization and Incorporation for Enhanced Coal Production

Nationalization of Coal Mines

The coal mines were nationalized to foster higher growth within the coal sector, aimed at meeting the escalating energy demands of the country. This strategic move was designed to ensure a steady and reliable supply of coal, essential for powering various sectors and supporting economic growth across the nation.

Establishment as Coal Mines Authority Limited

Following the nationalization, the entity was formally incorporated as ‘Coal Mines Authority Limited.’ This incorporation marked a significant step in organizing and managing the nation’s coal resources more effectively, setting a structured framework for operation and governance in the coal industry.

Also Read

Also Read

(Copyright@IndiaCSR)