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Contractor market in coal mining to grow to Rs 60,000 crore by 2030: KPMG

KPMG has also looked at some of the active mining contractors and compared their financial and technical competencies

BS Reporter  |  New Delhi 

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The market size of coal contract mining will grow to Rs 60,000 crore by 2030, said KPMG in a paper on ‘contractors in the market’. The current market size is Rs 15,000 crore.

The report said the market for Mine Developer and Operators (MDOs) and Active Mine Managers (AMMs) has grown in the last two decades.

“Today, a major part of the composite production of coal and overburden is through outsourced means (delivered by various contractors).

However, the understanding of this business is very sketchy, both at the end of mine owners as well as interested new entrants,” said the report, adding while there are 10-15 players in the sector but it has seen a lot of innovation.

In the public sector space (excluding Coal India and Singareni Colleries), MDO has been selected for more than 175 million tonne per annum (MTPA) of coal assets till now. This capacity is expected to significantly grow as another 10-15 MTPA is expected to be allocated to public sector units under the commercial mining process, the report said.

“There are various service providers in the of which the mining contractors, MDO and the active mine management segment is expected to be Rs 16,000 crore, Rs 17,000 crore and Rs 3,000 crore respectively by 2025,” it said.

KPMG has also looked at some of the active mining contractors and compared their financial and technical competencies. It has also dwelled on the reasons of delays/non-operationalisation of mines/non-fulfillment of several requirements, impact of such delays on appropriation of the performance security submitted by the mine owner to the Ministry of Coal and clauses in the tender document and mining agreement that require a specific focus to avoid this value loss.

First Published: Fri, September 27 2019. 17:15 IST
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