CIL plans to rope in private miners to boost output

In order to boost domestic coal output and reduce imports of the fuel, Coal India (CIL) plans to award mining contracts to private mining firms on public-private partnership (PPP) model. Reports suggest that global miners like Rio Tinto, BHP Billiton may partner with the state-run monopoly coal producer under this model. These companies may not have ownership rights in these ventures but they would do mining on a contractual basis for CIL. Yet these mining companies, equipped with better technology and machinery than CIL, can gain from their efficiency and earn good returns. The country witnessed almost 30 per cent expansion in coal imports over the last three years to 100 million tonne in 2012. Private miners would bid for CIL projects on the basis of per-tonne coal extraction costs and operate it on a contractual basis and without any ownership right. CIL has more than 200 coal mining projects where production is yet to start.