Diesel price hike to impact Coal India by Rs 600 cr
Posted on: 05:27 PM IST Sep 18, 2012
Kolkata: The hike in diesel prices will put an additional burden of Rs 600 crore per annum on Coal India Ltd in the production of coal, a top company official said on Tuesday.
"For each Re 1 hike in diesel prices, the impact is Rs 120 crore and so for a hike of Rs 5, the annual impact would be Rs 600 crore," Coal India Chairman and Managing Director S Narsing Rao told reporters in Kolkata on the sidelines of the company's annual general meet.
When asked if the PSU would revise coal prices, Rao said, "We will see".
For each tonne of coal production, the diesel cost is Rs 55, Rao said.
According to Coal India officials, the average cost of production per tonne is about Rs 560-570 and based on this the impact of fuel price hike is close to 10 per cent.
Speaking in the AGM, Rao said he expected some of the de-allocated coal blocks, following the coalgate to come to the Coal India stable.
However, there was no decision as yet regarding this in the Coal Ministry.
Speaking about Fuel Supply Agreement (FSA) and price-pooling, Rao assured shareholders that under no circumstances the final financial and legal interest would be jeopardised for signing the agreement.