NAGPUR | March 15, 2017: PSU coal miner, Western Coalfields Limited (WCL), is eyeing to beef up its turnover by extracting some sand as it digs out coal. As a diversification move, WCL has begun segregating sand out of the earth dug out for mining coal. A similar project for making bricks has also been started.
Overburden, as it is called in mining terms, is the soil dug out while opening mines. It is also used to refill the mines after the coal is entirely extracted. So far, overburden had no other use. Recently WCL has been extracting sand by a mechanical sieve from the overburden. It separates fine particles from the soil. Apart from it, rocks are also crushed into sand too.
The company has begun with supplying 500 cubic meters a day to Nagpur Improvement Trust (NIT), to be used in Pradhan Mantri Awas Yojana, a low cost housing scheme of government. However, recently WCL has got inquiries from other agencies including National Highway Authority of India (NHAI).
At full capacity, WCL is expecting to earn enough to count this income in its overall revenues. It may range anywhere between 5% to 10% of the PSU’s turnover, said a source.
WCL digs out 200 million tons of overburden in a year. Though this is used to refill the mines, the entire quantity is not consumed in the process. Due to the swell factor in soils, the volume of overburden goes up by 20% after being dug out. So after taking only the incremental 20% for making sand, rest can be still used for refilling the mines.
“The company has begun with a pilot project in Nagpur area where the soil has more sand content. However, the soil type is more or less similar in rest of the areas too where WCL has its mines. After supplying sand to NIT, WCL is planing to take up the venture on large scale basis too,” said a senior official in the mining company.
WCL is at present supplying sand at Rs160 per cubic meter as against the market price of Rs560. However with NIT taking for a government scheme, WCL is covering it under corporate social responsibility (CSR). However, when sold on commercial basis, the rate would be higher but still less than the prevalent market price, the source said.
Given the higher operating expenses of WCL, margin of profits will remain not much despite the production going up. To strengthen the finances, it needs to have extra income too, for which the sand business is being eyed, said a source in the company.
The company is seeing other advantages from activity too. Extra overburden has always been a problem for the mining industry. Extra land has to be acquired for dumping the earth. Now if 20% will be used for making sand, the land requirement will go down too, said the source.
Similar project of making bricks out of clay segregated from the overburden has also begun. A plant has been set up in Nagpur area and flyash supplied from Mahagenco is blended in the clay. WCL has entered into a MoU with NIT for using the bricks too. At present, the plant makes 15,000 bricks in day.
(Source: http://energy.economictimes.indiatimes.com/)