KOLKATA (miningweekly.com) – A total of 54 out of State-run miner Coal India Limited’s (CIL’s) 120 coal mining projects are delayed, the company says in its latest financial statement.

CIL reports that the major reasons for the delays in completion of the 54 projects are the time taken in securing mandatory environment and forest clearances, land possession complexities and issues relating to resettlement and rehabilitation of project-affected people.

According to the miner, five coal mining projects, entailing capital expenditure of $141-million, were completed during 2018/19, and two projects, worth $214-million, have so far been started during the current financial year.

Furthermore, the board has approved 20 projects, worth $1.68-billion, and these will be taken up over the course of the next few year, CIL reports.

CIL said that based on its 'Vision 2030' document for the coal sector, the miner aims to grow at a yearly rate of 7.6% until 2024/25 to meet increasing domestic demand for the dry fuel.

Despite internal growth targets set by the miner, there have been delays across a large number of ongoing projects. CIL only managed 0.1% year-on-year production growth in the first quarter of 2019/20, with output of 137-million tons. Meanwhile, meeting its 660-million-ton target for the current financial year will require growth of 8.5% over that of the previous financial year.

However, CIL’s production planning might undergo dramatic changes under government’s plans to break up the holding company structure and spin off its operational subsidiaries into independent listed companies, as certain media reports over the past month have suggested.

It is believed that the government is drawing up plans that will see five of CIL’s largest operational subsidiaries spun off into independent companies in the hope that competition between these companies will trigger higher domestic production of coal.

According to industry sources, the Department of Investment and Public Asset Management under the Finance Ministry has set out a strategy to hive off Mahanadi Coalfields, South Eastern Coalfields, Northern Coalfields and Central Coalfields, accounting for four-fifths of CIL’s production, into separate listed companies, and thereby empower them to raise greater funding from capital markets, increase competitive efficiencies and achieve a quantum leap in production.

A section within the Coal Ministry has dismissed that such a plan will be implemented, but if the Finance Ministry’s plans do prevail, it will comprehensively change the production planning of CIL over the next few years, industry sources say.