KOLKATA (miningweekly.com) - Coal India Limited (CIL) is seeking a foreign consultant to draw up a technology development and modernisation programme to cope with the rapidly changing demand-supply dynamics in the country.

According to a notice issued by the world’s largest coal miner, the mandate for the foreign consultants would be to “assess [the] status of existing technology for safety, production and productivity in opencast and underground coal mines of CIL, and assess gaps in technology in these underground and opencast mines”.

The consultants would also be required to identify technology and infrastructure development for mine planning, design and construction, keeping in view the production targets of the miner over the next 20 years.

Available Indigenous technology would also have to be identified and assessed by the consultants for its suitability in bridging the technology gap as would the level of import dependency if it were to be sourced from overseas technology service providers.

The initiative to engage overseas consultants to draw up a roadmap for technology and modernisation has been forced onto the near-monopoly supplier of coal, by the need to meet rapidly increasing demand from the energy sector.

CIL’s production target for 2012/13 has been set at 464-million tons and 492-million tons in 2013/14. But clearly the 6% growth in production was grossly inadequate to meet demand growth, particularly from thermal power providers.

According to India’s Planning Commission's Working Group on Coal and Lignite, coal demand was growing at a compound annual growth rate (CAGR) of 7.1% to touch 980-million tons by 2016. Against this, thermal coal imports were growing at a CAGR of 25% indicating the domestic-energy raw-material shortage in the country.

However, energy sector analysts pointed out that technology development and modernization were only one aspect hindering the miner from accelerating production growth and that more pressing issues such as delays in securing regulatory approvals, land acquisition and obtaining environmental clearances were not being adequately addressed.

For example, 179 CIL greenfield projects were still awaiting forest and environmental approvals and if these had been secured in time CIL would have been well placed to double its coal production to more than 1.1-billion tons a year by 2016, analysts said.

However, at the same time, upgrading and modernising CIL’s mining operations was an imperative since this was also taking its toll on production growth. The miner had over the past several years slowed down development and expansion of underground mines in view of steadily declining production trends from these assets.

CIL operates 467 mines, of which 273 were underground, 164 opencast and 30 a mix of both. Despite the large number of underground mines, production from these mines contributed just 38.39-million tons to the company’s total yearly production, largely owing to technology shortcomings, particularly the failure to adopt modern longwall mining practices.