Coal India’s capex grows 12% to Rs 14,834 crore in FY22

Coal India Limited (CIL) told the media that its capital expenditure (capex) witnessed a 12% growth to Rs 14,834 crore in FY22. Its capital expenditure stood at Rs 13,284 crore in FY21.

According to a statement, CIL's FY21 capex doubled in a year from that of Rs 6,270 crore in FY20. It means FY22 capex growth came on the back of a strong base.

The capex growth of CIL was to boost the output growth and align it with evacuation outlets.

Most of the capital expenditure was on land, procurement of heavy earthmoving machinery, setting up coal handling plants (CHP), silos and creating rail infrastructure for coal transportation.

Land and heavy earth moving machinery (HEMM) accounted for 40% of the total capex at Rs 5,867 crore, and capital expenditure under land stood at Rs 3,262 crore in 2021-22.

Land acquisition is crucial for CIL to augment its output from opencast (OC) mines. Land procured for two projects, Searmal and Talcher of Mahanadi Coalfields Limited (MCL), would help the Public Sector Undertaking (PSU) further expand its mining operations.

The centralised procurement of HEMM for CIL subsidiaries, including Eastern Coalfields Limited (ECL), Northern Coalfields Limited (NCL) and South Eastern Coalfields Limited (SECL), amounted to Rs 2,605 crore.

The company has planned to replace the old fleet with modern equipment to be deployed in OC mines, especially in SECL and NCL ramp up output production.

The other crucial capex expenditure, at Rs 2,322 crore, was for setting up coal handling plants or silos, with a major share taken up by NCL, SECL and Mahanadi Coalfields Limited (MCL).

Strengthening the evacuation infrastructure through rail sidings and corridors accounted for Rs 2,307 crore of the total capex.

CIL accounts for more than 80% of the domestic coal output.

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