I am delighted to welcome you to the 43rd Annual General Meeting of Coal India Limited.The Directors' Report and the Financial Statement for the year ended 31st March 2017together with the report of Statutory Auditors and report and review of Comptroller &Auditor General of India are already with you.
1. Importance of coal and Coal India Limited
There is a perceptible shift in the country in fortifying the energy options currently.Renewable energy sources like Solar and Wind are being explored encouraged and added asenergy upgrades to meet the growing energy demand in the country. As clean energy optionsthey are welcome. The addition from these sources to the energy mix can be viewed ascomplementary but not competitive to coal's role. They certainly can supplement but cannotsubstitute coal as preferred energy fuel at least for now.
Coal has gotten immensely cleaner over the past generation. New and better ways arebeing found to extract energy from coal without sending its by products into theenvironment. HELE that is High Efficiency Low Emission technology is one such step inbringing down the emissions.
In India what makes coal such a preferred energy fuel is its abundance availabilityand affordability. The estimated geological resource of coal in India stood 315.149Billion Tonnes as of 1 April 2017. Around 73% of the entire power generated in thecountry is coal based.
Reliable energy is a correlate of economic growth and human development. Coal beingreliable continues to serve the country as its primary commercial energy provider andwill remain a mainstay in Indian power generation for decades to come. In fact relianceon coal might increase in future.
Against this back backdrop you will be proud to know that your company Coal IndiaLimited spearheads the country's coal production and produces 84% of the country's entirecoal output. It is Coal India which virtually fuels and empowers the power sector in thecountry.
2. Accomplishments 2016-17
Sustaining the growth arc in production and off-take the company had exceededhalf-a-Billion Tonne mark in both the physical facets for the second consecutive year.
During 2016-17 Coal India achieved coal production of 554.14 Million Tonnes (Mt). Youwill be pleased to know that company has increased its production by 15.39 million tonnesover last year. Coal production has taken a quantum jump of over 100 MTs in a five-yearspan from the level of 452.21 Mt. recorded in 2012-13 to the current level. This scale ofincrease has never been achieved previously during a 5-year period.
The performance of NCL CCL and BCCL merit specific mention as the three companies haveachieved their respective AAP targets in coal production amid trying circumstances. SECLcontinues to be at the helm of coal production with 140 Mt. mark during the year with MCLgiving a close competitive run up with 139.21 Mt.
Raw coal off-take during FY 2017 was 543.32 MT an increase of 8.82 MTs on ayear-on-year comparison. NCL has achieved AAP target in off-take also despite heavymonsoon.
ECL CCL NCL MCL and NEC achieved higher off-take than previous year.
Coal despatch to power utilities (including special forward e-Auction) during the yearwas 425.397 Mt. registering a growth of 3% compared to last year (413.11 Mt.). Despatch toNTPC clocked a growth of 4.9% over last year registering a materialization of 95% againstFSA/MoU commitment. But for the regulated intake of coal by many of the GenCos despatchof coal to power sector could have been higher.
1) You will be pleased to know that your company's Gross Sales turnover was Rs122294.46 crores during the financial year 2016-17.
2) The underground production got major boost with the introduction of Longwalltechnology in Jhanjra Combined UG Mine (3.5 Mty.) of ECL in August'2016.
3) Coal India has been accredited with IS/ISO 9001:2015 (Quality Management System) andIS/ ISO 50001:2011 (Energy Management System) certification on 27th October'2016. It isnow in the process of implementation of ISO 14001: 2015 (Environment Management System).
Coal India is one the highest contributors to the government ex-chequer both Central and State governments. Coal India paid corporate taxes of Rs 8942.70 crores toGovernment of India in FY 2016-17.
Coal India and its subsidiaries had also paid/adjusted Rs 44070.22 crores RoyaltyCess VAT DMF and NMET and other levies. During 2016-17 Coal India as a whole earnedpre-tax profit of Rs 14433.71 crores and a Profit after Tax of Rs 9265.98 crores.
Your company had paid an interim dividend of Rs 12352.76 crores @ Rs 19.90 per share.Of the total dividend the share of Govt. of India was Rs 9736.40 crores and the rest Rs2616.36 crores was given to other shareholders.
3. Strategies for Growth
Coal India is faced with meeting challenging targets in the years ahead. Going forwardin order to meet the production targets Coal India needs to step up to a double digitgrowth rate.
To sustain the growth momentum in its production and off-take in future Coal India hasformulated following multi-pronged strategies.
(i) Critical Railway Links - Collaboration with State Governments & Railways.
In a move of Synergy for Energy' to achieve the planned growth in production andevacuation in future your company has undertaken three major Railway InfrastructureProjects implemented either by Railways or JV Companies formed between IRCON SubsidiaryCompany and concerned Statement Government.
The three major Railway Infrastructure Projects are :-
(a) Tori Shivpur-Kathotia New BG Line. This railway line caters to NorthKaranpura Area of CCL and it is Planned to evacuate about 32 MTY of coal once the linecomes through.
(b) Jharsuguda Barpali Sardega Rail Link relates to the coalfields of MCLand the envisaged capacity evacuation is 70 MT/Y of coal from MCL.
(c) East Rail Corridor and East West rail corridor is planned for evacuation of coal ofMand- Raigarh and Korba Gevra Coal-fields of SECL respectively. In all about 180MTY of coal shall be evacuated through these two corridors.
(ii) Acquisition and Possession of land
During 2016-17 total of 3826.19 Hectares of land has been taken into possession invarious subsidiaries of Coal India.
In all subsidiaries of Coal India the major portion of land is acquired under the CoalBearing Areas (Acquisition & Development) Act 1957.
(iii) WEB Based Online Monitoring System
Following the introduction of Web based online monitoring of coal mining projectscosting more than Rs 100 crores so far the monitoring of 69 projects costing more thanRs 150 crores and capacity 3.0 MTY and above has been completed during the 2016-17.Additionally monitoring of 67 coal mining projects (more than Rs 150 crores) has alsobeen taken up during the year.
Critical issues are uploaded by CIL and its subsidiary companies on MOC's e-CPMP portalwhich enables MOC to follow up with the state governments and associated ministries toaccelerate EC & FC approvals.
(iv) Technology Development a. Exploration capacity is planned to be augmented withmore use of hydrostatic drills geophysical loggers 2D/3D Seismic Survey Technology andOptimization of number of coring boreholes based on the complexity of geology of theblock. b. Introduction of high capacity equipment Operator Independent Truck DispatchSystems Vehicle Tracking System using
GPS/GPRS CHP and SILOS for faster loading and monitoring using laser scanners havebeen planned to augment coal production from opencast mines. c. Introduction of ContinuousMiner Technology on large scale Long Wall Technology at selected places Man Ridingsystem in major mines and Use of Tele - monitoring techniques continued to receivepriority to increase production from underground mines.
(v) System Improvements
Introduction of e-procurement of equipment and spares e-tender of work and servicesERP implementation establishment of connectivity revision of guidelines and manuals useof GPS for monitoring operational efficiency in road transport of coal have been plannedto improve the overall system.
(vi) Customer Satisfaction
a) For enhanced customer satisfaction special emphasis has been laid on QualityManagement deciding to declare 2017-18 as Quality Year'.
b) To monitor coal quality internally a portal has been designed by CIL to analyzecoal quality on regular basis to capture entire life cycle of the sample.
c) The guidelines/SoP issued by MoC on third party sampling at loading ends had alreadybeen implemented through Central Institute of Mining and Fuel Research (CIMFR). Samplingfor quantity covered under FSA is continuing across various loading points of coalcompanies.
d) For greater consumer satisfaction and to resolve consumer complaints qualitymanagement is being following diligently.
On-line filing for redressal of complaints has been initiated. 99.42% of consumercomplaints have been resolved during the year 2016-17.
4. Green Initiatives
Environmental and eco-system restoration is a conscious effort in Coal India. Yourcompany is aware of the importance of environmental issues and tries to the extentpossible to restore the environment and Nature to its original pristine condition.Mandatory obligations apart Coal India takes it upon itself as a moral obligation.
To promote Green Initiatives taken by GoI CIL has submitted Green Energy Commitmentletter to MNRE for developing 1000 MW Solar Power Projects. For implementation ofthese projects CIL has signed MoU with Solar Energy Corporation of India (SECI). CoalIndia has given its consent for floating of NIT for 800 MW Solar PV Project to SolarEnergy Corporation of India (SECI). In the 1st Phase land has been identified by SECI forsetting up of 250 MW Solar PV Project in the Solar Park of Madhya Pradesh Government inNeemuch Area. The power generated from the Projects will be used for captive consumption.
Plantation and Green belt are developed through extensive tree plantation programmesevery year by the subsidiaries of Coal India. The subsidiaries of CIL have planted around94.015 million of trees covering an area over 37557.458 Ha. till March'2017 and during2016-17 1.66 million trees have been planted covering an area of 661.20 Ha.
5. Safety Always a priority
Safety of miners and mines remains a top priority concern for Coal India. In pursuit ofhigher production no compromise would be made on safety front. Safety of miners and minesoverride any other priority. Coal India has a well-defined safety policy to ensure safetyin all mines and establishments. There are many preventive measures being pursued againstaccidents. Safety personnel are exposed to the best practices internationally and are sentfor training abroad enabling them to hone up their skills and to sensitize them toapproach safety issue in a scientific and holistic manner. We are also inculcating andmonitoring a safety culture and attitude. The endeavor is to elevate safety standardsradically further since in this regard there could be only Zero Accident' as thegoal.
6. Corporate Social Responsibility
Apart from improving the quality of lives of people Coal India's Corporate SocialResponsibility initiatives also take them along towards the company's goal by partneringwith them. While pursuing the enhancement of Coal production CSR is being undertaken forinclusive growth of villagers and the nearby affected communities. Coal India has spent Rs489.67 crores in FY ending 2017 on CSR initiatives. Major activities undertaken are :
1) Training and preparation of Sports persons for Olympics and Para Olympics at projectoutlay of Rs 75 crores (` 25 crores per annum) through Ministry of Youth Affairs Govt. ofIndia.
2) Setting up 16 Continuous Ambient Air Quality Monitoring Stations in 10 cities at anoutlay of Rs 65 crores.
7. Corporate governance
Coal India complied with the conditions of Corporate Governance as stipulated in theGuidelines on Corporate Governance for Central Public Sector Enterprises (CPSEs) issued bythe Department of Public Enterprises Government of India and Regulation 34(3) read withschedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015with the Stock Exchanges. As required under the guidelines and provisions a separatesection on Corporate Governance has been added to Directors' Report and a Certificateregarding compliance of conditions of Corporate Governance has been obtained from apractising Company Secretary. Coal India has conducted Secretarial Audit for 2016-17 asrequired under Companies Act 2013 and the Secretarial Audit Report is enclosed as a partof Directors report.
Coal India's vision is to ensure that there is no shortage of coal in the country andto make the country self-reliant in coal. Coal India envisions to be a commercially viablecompany and endeavours to move ahead as a contemporary professional consumer friendlyand successful corporate entity committed to national developmental goals. The vision alsoextends to dedicate itself to the service of the countrymen in providing the primarycommercial energy in an affordable and environmentally friendly manner. Coal India aims tobe not only a valued company but a company with values through constantly innovating onease of doing business.
On behalf of your Company's Board of Directors I wish to convey my deep gratitude toyou our valued shareholders for your continued support and trust. This motivates us toexcel in all our pursuits and constantly create value for you as well as for the nation. Iappreciate the unstinted support and valuable guidance received from the Ministry of CoalGovernment of India. I also express my sincere thanks to other Central GovernmentMinistries and Departments State Governments all employees Trade Unions AuditorsConsumers and Suppliers for their continuous co-operation.
| ||Sd/- |
| ||Sutirtha Bhattacharya |
| ||Chairman |
| ||(DIN 00423572) |
|Kolkata || |
|Dated: 9th August' 2017 || |