90 Coal India and the Ministry of Coal have consistently blamed the under

90 coal india and the ministry of coal have

This preview shows page 23 - 27 out of 32 pages.

90 Coal India and the Ministry of Coal have consistently blamed the under-production on delays in obtaining environmental and forest clearances from the Ministry of Environment. Data from CIL does not justify this claim. A closer look at 2010-11 production levels from five CIL subsidiaries for which Greenpeace obtained data shows that these five companies had a permitted production level of 405 mt, against which they produced only 353 mt. These five subsidiaries accounted for 82% of CIL’s production in that year. In April 2012, Minister for Environment and Forests Ms. Jayanthi Natarajan stated that the MoEF has given clearances (for both CIL and non-CIL projects) for 830 mtpa of coal, against which the production in (2012) was only ~550 mtpa. 91 Other analyses have shown that the MoEF approval rate for projects is nearly 100%, with virtually no projects rejected. 92 2007-08 2008-09 2009-10 2010-11 Permitted Actual Permitted Actual Permitted Actual Permitted Actual ECL 19.41 24.05 31.5 28.09 31.02 32.37 32.88 30.76 NCL 58 59.62 61.25 63.65 66.5 67.67 72 66.25 MCL 132.57 88 132.57 96.33 132.57 104.13 132.57 100.27 SECL 100.85 88.50 102.85 93.79 111.915 101.89 117.71 108.44 CCL 44 44.05 47 44.30 48 47.08 50 47.52 Total 354.84 304.24 375.18 326.17 390 353.16 405.17 353.25 Table 3: Permitted vs actual production (million tonnes) ECL: Eastern Coalfields, NCL: Northern Coalfields, MCL: Mahanadi Coalfields, SECL: Southeastern Coalfields, CCL: Central Coalfields. Data on permitted production levels for Western Coalfields and Bharat Coking Coal Limited was not provided to Greenpeace Is CIL’s under production an indicator of poor reserve certainty? Coal India: Running on empty?
Image of page 23
Image of page 24
23 Conclusions Section 06 Coal India’s initiative to rely upon global capital markets to support its corporate activities brings with it increased requirements for transparency. Investors in the global market seek a uniform system of assessing coal reserves. Coal industry officials from around the world have labored for over a decade to establish such a system. This brief study shows that the initial review by CMPDI using international standards has produced extractable coal reserve estimates 16% below Coal India’s estimates contained in its 2010 Red Herring. The relationship of the estimates under the international standards and that produced by CIL under India Standard Procedures (ISP) needs to be reconciled. The logical next step is an independent assessment of Coal India’s extractable reserves and current mining practices, taking into account geological, economic and feasibility issues. This study has identified at least one area where the information that formed the basis of CMPDI’s 18.2 billion ton estimate is incomplete. An independent evaluation can test whether Coal India’s extractable reserve figure of 18.2 billion tons is overestimated. Coal India’s efforts to secure additional extractable reserves from exploration, foreign acquisition and imports needs to be carefully monitored going forward. A failure to base these monitoring efforts on solid information and risk analysis will inevitably lead to poor financial performance, adverse shareholder reactions and global pressures on Coal India to reform.
Image of page 25
1 Planning CommiSsion (Government of India), 2013. Twelfth Five Year Plan (2012-2017) Economic Sectors. P.136,
Image of page 26
Image of page 27

You've reached the end of your free preview.

Want to read all 32 pages?

  • Fall '10
  • BOB
  • Coal, Coal India Limited, CIL’s extractable coal reserves

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes