Singareni Collieries Co Ltd (SCCL) will raise coal production by about two million tonnes during 2012-13 to 53.10 mt through opening of new mines and improving productivity.
Its 12th Plan target is to reach a production of 57 mt by 2016-17.
Although the recent wage agreement will impose an additional cost of about Rs 700 crore, the miner will not increase its overall prices, except for “some corrections” in its lower grade of coals.
Mr S. Narsing Rao, the company's CMD, said average cost of production in the current fiscal increased to Rs 1,570 per tonne, compared to Rs 1,541 last fiscal.
“Average sales realisation was Rs 1,676 a tonne, compared to Rs 1,554 last year. Sales realisation increased as we supplied about 3 mt of coal to NTPC above the linkage of 10.2 mt at a premium,” he told newspersons here on Saturday.
Admitting that the company was losing in most of its underground mines, Mr Rao said: “What is important is to maintain a higher aggregate cost. Our endeavour remains to increase profitability from underground mines.”
The average production cost from its underground mines is about Rs 3,051 a tonne, while that from its open cast sources is Rs 1,130 a tonne. Underground mines account for about 21 per cent of its production, which it plans to increase to 30 per cent in the next two years. “We have started work on two underground projects,” he said.
It will be taking up six to eight underground projects in the next 5-10 years, for which it will consider the outsourcing model — getting private miners to invest on a revenue sharing model. It is trying out this model for one of the two projects that it has taken up on a pilot basis.