SCCL may pitch for higher coal prices

Hyderabad, Jun 27 (UNI) Faced with a 40 per cent raise in input cost, state-owned Singareni Collieries Company Limited (SCCL) is getting ready for a crucial board meeting here tomorrow pitching for possible hike in the coal price, SCCL Chairman and Managing Director R H Khwaja indicated today.

The meeting also comes in the backdrop of the SCCL planning a capital investment of Rs 577 crore to open three new mines to meet its production taget of nearly 38 million tonne in the current fiscal, he said while interacting with the media.

After wiping out accumulated losses of Rs 1,219 crore two years back and making profits ''for the first time in 37 years,'' SCCL had again sounded the alarm bell in the face of hike in the deisel price which alone cost it Rs 200 crore in 2005-06.

Besides increase in steel prices and wages had upped its cost of production.

With the seventh wage board expiring on June 30 this year, SCCL will have to pay at least Rs 820 crore to its 86,000-odd employees, if new wages were negotiated at the 2001-level.

Its VRS schemes with a minimum of Rs 10 lakh till now extended to 14,000 employees is likely to be offered to another 1000 employees this year as ''trade unions has been pressing for extending the packages to more segments of the workforce,'' he added.

Amid a supply-demand gap of five million tonnes, likely to go up to around eight million tonne in the next few years, SCCL had planned for nearly 20 per cent growth in its production to 37.5 million tonnes this year, up from 36 million tonnes in 2005-06 -- which was its highest ever production in its 117-year history.

Even as it placed its plea to Tariff Commission appointed by the Union Industry Ministry last month, SCCl was grappling to cope with the increased cost of production.

With average cost of production at Rs 945 a tonne, SCCL average sale price was Rs 1,018 per tonne after it was allowed a eight per cent price increase in 2004 against 16 per cent permitted to Coal India Limited, the public sector coal major.

The price hike should be across the board, the SCCL official said.

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