Diesel price rise blows Rs 700 crore hole for Coal India in Q1FY22

Mining major Coal India suffered losses to the tune of Rs 700 crore in the April-June quarter owing to a sharp rise in diesel prices, a top company official said.

In the quarter (under review), we lost about Rs 700 crore as diesel prices increased by about 35 per cent. It was in the range of Rs 66-67 and now at around Rs 89. This has been a substantial rise, Coal India Chairman Pramod Agarwal said during a recent earnings conference call.

The state-run miner has been drawing up plans to replace its diesel-run heavy machinery with LNG-fired equipment, and adding 1,500 electric vehicles to its fleet in the next five years to support carbon emission cuts.

CIL has envisaged creating a carbon offset of around 2.5 lakh tonnes over the next five years, the Kolkata-headquartered company said.

It has also taken initiatives for a pilot project in collaboration with GAIL (India) Ltd in some mining sites before starting bulk use of LNG.

Agarwal had also said the costs of Coal India have gone up and there is no reason that the mining behemoth should not increase price of the dry fuel.