A PROJECT REPORT ON A STUDY ON SALES AND MARKETING OF COAL AT CENTRAL COAL FIELD LTD.

(RANCHI) AS A PART OF PARTIAL FULFILLMENT FOR PGDM By: SHABNAM PRAVEEN UNDER THE GUIDANCE OF PROF. MANISHA PALIWAL

SINHGAD INSTITUTE OF MANAGEMENT

2O11-2012

1

DECLARATION
I, Shabnam Praveen the undersigned, hereby declare that the Project Report entitled A Study on Sales and Marketing of Coal written and submitted by me to the Sihngad Institutes Pune, in partial fulfillment of the requirement for the award of degree of PGDM Administration under the guidance of Prof. Manisha Paliwal is my original work and the Conclusions drawn therein are based on the material collected by myself.

Place: Date: SHABNAM PRAVEEN MPM “B”

2

ACKNOWLEDGEMENT
Inspiration, Encouragement and Guidance forms the backbone to success.

The satisfaction that accompanies the successful completion of project would be incomplete without mention of those people who made it possible through guidance and encouragement

I would like to express my sense of gratitude to all those who helped me in so many ways in preparing the training project entitled “Training on Sales and Marketing of coal” in C.C.L. I am thankful to Mr. G. Purohit (G.M. HRD) of C.C.L Ranchi for permitting me to conduct the survey on this topic at C.C.L. I would also like to thank Mr. M.S. Bhutani Sr. Manager and Miss. Nishi (Sr. Sales Officer) under whose supervision and guidance I was able to complete this project.

Shabnam Praveen

3

PREFACE
Project work is an essential part of the post graduate diploma in management. I the training program the management students get into practicalities to learn how to work are done in the real life situation in the organization. It’s not only a learning process but also experiencing.

I was fortunate enough to get into my training from CCL. Ranchi. I achieved all the objectives which any trainee will seek to achieve in his/her internship programmed. The basic objective to training at an organization like Central Coalfield Limited. Is to get exposure in the orientation on HR accept. Moreover another objective was to enhance my managerial skills and I achieved all these objectives.

This study is carried out under partial fulfillment of PGDM course, The information of study is given further in form of different chapters.

detailed

4

INDEX

CHAPTER

PARTICULARS

PAGE NO.

01. 02. 03. 04. 05. 06.

INTRODUCTION PROFILE OF THE ORGANISATION RESEARCH METHODOLOGY CONCEPTUAL BACKGROUND DATA PRESENTATION,ANALYSIS AND INTERPRTAETION FINDINGS AND CONCLUSION BIBLIOGRAPHY ANNEXURE

5

CHAPTER 1 INTRODUCTION 6 .

Coal Mining is also being open up to private investment. With eight wholly owned subsidiary companies. CIL welcome private participation in coal beneficiation. has sanctioned major policy support package which. Indian coal is eco-friendly. The government of India. the sole owner of CIL. 17 beneficiation plants and one coal carbonization plant are some in CIL’s range of activities. has progressively freed and coal prices administrative control. Identification of coal reserves. detailed exploration followed by projectisation. besides restructuring government’s holding in the company.INTRODUCTION • Coal India Ltd : Indian coal at the pithead is the cheapest coal in the world with low sulphur content. Participation of international coal mining companies of development of underground coal mines with modern technology is also receiving CIL’s consideration. operating is an many states. 7 . CIL’s activities comprehensively cover A to Z in Coal extraction. CIL’s business plan therefore aims primarily to translate these strong economic fundamentals of coal into prosperity for the country and the company. design and implementation of projects and optimizing operations in 465 existing underground and open cast mines.

Coal Tar Coal Gas Coal Chemicals etc. This was the first joint stock company in India 4. Government of India. CIL have now 8 subsidiaries viz. 9. Bharat Coking coal Limited (BCCL). Western coalfields Limited (WCL). having about 6.(A public sector undertaking of Govt. 1843 M/S Carr. 6. Washed Coal.(CIL) 11. Soft coke &Hard Coke. Middling’s. 8 . 1743 Commercial production of coal by East India Company for the manufacture of arms and ammunitions. Coal India presently contributes 90% of the total coal production in India.COAL INDIA: Coal India Limited. Tagore and other company amalgamated into the Bengal Company Ltd. 8. 1956 Formation of National Coal Development Corporation Ltd. 1971 Coking Coal Nationalization. SAIL-IISCO & DVC. Coal India currently operates mine and Washeries spread over nine states to produce and beneficiate coal for meeting the demand of the consumers all over the country. 5. 7. Ltd. 2000 De-regulation of Coal pricing and distribution of coal.Central Coalfields Limited (CCL). 10. IMPORTANT EVENT 1. 13. of Andhra Pradesh) and the captive mines of TISCO. Mahanadi Coalfields Limited (MCL). It was formed as a public sector undertaking in November 1975 for reorganizing the nationalized coal mines and ensuring integrated development of coal. 1815 Opening of the first shaft mine near Raniganj town. 1855 Opening of railway from Calcutta to Raniganj. and Central Mines Planning and Design Institute Limited (CMPDIL). South Eastern Coalfields Limited (SECL). 2. Northern coalfields Limited (NCL). the prime source of energy. the turning point Coal industry for India. 1853 Commencement of Railway service in India. 1985 Northern coalfields limited (NCL) and south eastern coalfields Limited (SECL) carved out of CCL and WCL. 1975 Establishment of Coal India Ltd. 3.of India undertaking 1 st phase of coal nationalization. the third largest coal producing company in the world. 1862 Coal mine began in central provinces Jharia Coalfields by Govt. Eastern coalfields Limited (ECL). The ranges of products are: Raw Coal (Coking and Non Coking). for the entire coal industry in the country barring the coal Mines in Andhra Pradesh (which comes under the jurisdiction of Singareni Collieries Co. 1992 Mahanadi Coalfields Limited (MCL) formed out of SECL to manage the talcher and IB Valley Coalfields in Orissa. 1973 Non-Coking Coal Nationalization.4 lakh employees with headquarter in Calcutta is a holding company under Ministry of Coal. 12.

Policy formulation and advisory functions. Marketing of coal as main product Acquisition of Coal mining. 2011 Coal India accorded “Maharatna “ status OBJECTIVE 1. Reorganization and reconstruction of Coal mines taken over by Government. coke manufacture in all their respective branches. 3. SCOPE The scope of the study is limited to the city of Ranchi only. 2008 Coal India accorded “Navratna” status 16. 4. Exploration and prospecting.WCL. 8. To manufacture and sell Coal as a patent fuel. MCL.14. And the number of respondents chooses was 60 who was surveyed at Central Coal field Limited in Darbhanga House Ranchi. sale and disposal of Coal and bio-products. To carry on business of coal mining. 7. NCL. 15. 5. 2. To act as colliery and mine proprietors. conferred “Mini Ratna” status. Production.SECL. 9 . 6. 9. 2007 Coal India & five of its subsidiaries viz.

Sales and Marketing of coal process if done in proper way helps to increase organization productivity.The scope of the study to know that to sales and marketing of coal and suggest accordingly and also for their production growth and it is essential for every organization to attain their goal is an effective manner and it should be done and it should be increase the performance of the present as well as with the new consumer. CHAPTER 2 PROFILE OF THE COMPANY 10 .

Competitive & Profitable Coal Mining Operation to achieve Customer Satisfaction 11 .friendly mining” Being the domestic leader. Ratu Road. MISSION “To become a World class.PROFILE OF THE ORGANISATION: Name: CENTRAL COALFIELD LTD Address: RANCHI Location: CCL Headquarter Darbhanga House. Ranchi (Jharkhand) Pin-834001 VISION “Committed to create eco. CCL strive to be the leading international player in energy sector through best practices from mine to market. Innovative.

1971 and 12 . in the context of safety. conservation and quality. Again in the year 1975 CMAL was re-organized as Coal India Limited (CIL). CCL was again re-organized in the year 1986 and two separate companies known as northern coalfields limited and Mahanadi coalfields limited came into existence. Coal mining first started in the year 1815.As top priority” • The Mission of CCL is to produce and market the planned quantity of coal and coal products efficiently and economically with due regard to safety. the Government of India took over all coking coal mines on October 16. Central division of CMAL was known as Central Coalfields Limited (CCL). After nationalization of non-cocking coal sector in 1973 became the central division of Coal Mines Authority Ltd. The main thrust of CCL in the present context is to orient its operations towards market requirements maintaining at the same time financial viability to meet the resource needs. which suggested the amalgamation of small and fragmented producing units. conservation and scientific development.f 01-10-1956 with the establishment of National Coal Development Corporation (NCDC). Coal mining through national sector first started w. The private railway companies started mining activities in the year 1850. The railway board nationalized the coal mining in 1925. • HISTORY OF THE ORGANISATION The Indian energy sector is largely dependent on coal as the prime source of energy. Before proceeding further it should be noted that CCL is a subsidiary of CIL and is completely owned and operated under their guidelines.In the pre-nationalized era coal mining was controlled by private owners. unhealthy mining practices and sole motive of profiteering. The objective of nationalization was the conservation of the scarce coal resource. Subsequently.e. and suffered from their lack of interest in scientific methods. The railway collieries were transferred to the coal board in the year 1944. After independence a greater need for coal production was felt in the First Five Year Plan. particularly coking coal in India. In 1951 a Working Party for the coal industry was set up. The miners lived in sub-standard conditions as well.

Coal India Limitedon November 1. 1975.nationalized them on May 1. ADMINISTRATIVE SETUP Chairman (Coal India Limited) Board of Director+ CMD of all subsidiary (CCL) Director (Personnel) Director Director (Project & planning) Director (Operation) (Finance) 0 0 GM (Sales & Marketing) Deputy Chief Sales Manager 13 . 1972. Coal Mines Authority Limited (CMAL) was formed in 1973. Following the state takeover of non-coking coal mines. Bharat Coking Coal Limited (BCCL) was thus born. leading to the formation of a formal holding company.

Sales Manager Deputy Sales Manager Senior Sales Officer Sales Officer CHAPTER 3 RESEARCH METHODOLOGY 14 .

C.L. Although this research is highly accurate.RESEACH METHODOLOGY TOPIC:” Study on Sales and Marketing of Coal”: with special reference to C. procedures and technique used to find the result of a problem is called a research methodology TYPES OF RESEARCH: Descriptive Research: Descriptive research is a also called Statistical Research. The main goal of this type of research is to describe the data and characteristics about what is being studied. a frozen ready meals company learns that there is a growing demand for fresh ready meals but doesn’t know much about the area of fresh food and 15 . averages. The idea behind this type of research is to study frequencies. Descriptive research is mainly done when a researcher wants to gain a better understanding of a topic for example. Research Methodology: A system of models.” Research :A research is an organized set of activities to study and develop of model or procedure/technique to find the result of a realistic problem supported by literature and data such that its objectives is optimized and further make recommendation /interferences for implementations. and other statistical calculations. it does not gather the causes behind a situation. Ranchi.

Sources: a) Various Newspaper b) Various websites Some b 16 . DATA TYPE: Primary Data and Secondary Data. Telephone interview. EXPLORATRY Research: Exploratory Research is an initial research which analyzes the data and explores the possibility of obtaining as many relationships as possible between different variables without knowing their end.applications.. Sources: a) b) c) d) Observation method Personal interview. Mail survey Secondary Data:.so has to carry out research in order to gain a better understanding.Data collected from sources which have already created for the first-time use and future uses. It is quantitative and uses survey’s and panels and the also the use of probability sampling. This means that a general study will be conducted without having any specific end-objective expect to establish as many relationships as possible between the variable of the study. Primary Data: The data collected from the field under the control and supervision of an investigator. Descriptive research is the exploration of the existing certain phenomena.

CHAPTER 4 CONCEPTUAL 17 .

BACKGROUND MARKETING MIX The marketing mix was first developed by McCarthy over 40 years ago. 18 . It was designed to suggest that we have a balance mix of marketing in our marketing plan.

it is useful to realize that is still a pricing strategy. Defining on a pricing strategy. special offers). personal selling (e. Identifying the total cost to the user (which is likely to be higher than the charge we make) is a part of the price element. sales promotions (e. PROMOTION This includes advertising.g.Element of the marketing mix-the 4 Ps PRODUCT Defining the characteristics of our product or service to meet the customer’ needs. Even if we decide not to charge for a service.g. attending exhibitions). and atmospherics (creating the right impression through the working 19 . PRICE.

PLACE Looking at location (e.environment). It produces different types of coal which are:COKING COAL: 20 .g. Public Relations are included within promotion by many marketing people (through PR people tend to see it as a separate discipline). of a library) and where a service is. PROFILE OF THE PRODUCT The primary product of CCL is coal. Since then other expert have looked at the marketing mix and suggested it is much deeper in that business success is driven by PEOPLE and PROCESS.

NON. • • These have comparatively less coking properties than coking coal Mainly used as blend-able coal in steel making. These have coking properties 2. paper. when heated in the absence of air. Because of higher ash content. when heated in the absence of air. ceramic. • • Mainly used in metallurgical industries Also used in industrial plants utilizing furnaces WASHED AND BENEFICIATED COAL: These coals have undergone the process of coal washing or coal beneficiation. Also used for cement. form coherent beads. Also used for hard coke manufacturing SEMI COKING COAL: These coals. Mainly used as thermal grade coal for power generation 2.These coals. with strong and porous mass called coke. This coal is used for power utilities and non-core sector consumers. and for other heating purposes HARD COAL: Hard coke is formed from coking/semi-coking coal through the process of carbonization. 1. form coherent beads not strong enough to be directly fed into the glass furnace. merchant coke manufacturing and other metallurgical industries NLW COKING COAL: This coal is not used in metallurgical industries. free from volatiles. 1. this coal is not acceptable for washing in washeries. chemical and brick manufacturing . fertilizer. glass. resulting in value addition of coal due to reduction in ash percentage.COKING COAL: These are coals without coking properties. Mainly used in steel making and metallurgical industries 3. • • Used in manufacturing of hard coke for steel making Beneficiated and washed non-coking coal is used mainly for power generation 21 . Such coals are blended with coking coal in adequate proportion to make coke.

• Used in industrial furnaces as well as for domestic purposes TAR / HEAVY OIL/ LIGHT OIL / SOFT PITCH: These are products from Dankuni Coal Complex using low temperature carbonization of noncoking coal in vertical retorts. environment friendly product of the Dankuni Coal Complex.• Beneficiated and non-coking coal is used by cement. etc. • • used for power generation Also used by domestic fuel plants. sponge iron and other industrial plants MIDDLINGS: Middling’s are by-products of the three stage coal washing / beneficiation process. obtained from the Dankuni Coal Complex and other coke oven plants. CIL COKE/ LTC COKE: CIL Coke/ LTC Coke are a smokeless. • Used in furnaces and boilers of industrial plants as well as power houses. pharmaceutical industries. oil. etc COAL FINES / COKE FINES: These are the screened fractions of feed raw coal and LTC coke / CIL Coke respectively. • Used for Fluidized Bed Combustion (FBC) Boilers for power generation. obtained through low temperature carbonization. brick manufacturing units. hotels. dye. cement plants. land filling. etc. COKING COAL 22 . REJECTS: Rejects are the product of coal beneficiation process after separation of cleans and / or middling’s. • • Used in furnaces and kilns of industrial units Also used as domestic fuel by halwais. as a fraction of feed raw coal. industrial plants. briquette (domestic fuel) making. as a fraction of feed raw coal. The parameters of classification of coal are:A. road repairs. etc.

Grade Steel-1 Steel-2 Washery-1 Washery-2 Washery-3 Washery-4 Parameters Ash not exceeding 15% Ash exceeding 15% but not exceeding 18% Ash exceeding 18% but not exceeding 21% Ash exceeding 21% but not exceeding 24% Ash exceeding 24% but not exceeding 28% Ash exceeding 28% but not exceeding 35% B. SEMI COKING COAL Grade Parameters Semi Coking-1 Ash + moisture not exceeding 19% Semi Coking-2 Ash + moisture exceeding 19% but not exceeding 24% D. NON COKING COAL Grade A B C D E F G Exceeding 6200 Exceeding 5600 but not exceeding 6200 Exceeding 4940 but not exceeding 5600 Exceeding 4200 but not exceeding 4940 Exceeding 3360 but not exceeding 4200 Exceeding 2400 but not exceeding 3360 Exceeding 1300 but not exceeding 2400 UHV Range (Kcal/Kg) C. ASSAM COAL Grade A UHV Range (Kcal/Kg) 6200-6299 23 .

T 19.Coking Coal Washeries 1 Central workshop 5 Regional workshop Workshop Operating Coalfields 6 (East Bokaro. North Karanpura.B 5600-6199 E.T (48% of total reserves) 24 .023B. South Karanpura.539B.HARD COKE Grade By Product Premium By Product Ordinary Beehive Premium Beehive Superior Beehive Ordinary Ash % Not exceeding 25% Exceeding 25% but not exceeding 30% Not exceeding 27% Exceeding 27% but not exceeding 31% Exceeding 31% but not exceeding 36% Presently CCL Has Number of Mines Washeries 59 Mines (22 Underground& 37 Opencast Mines) 7 Washeries 4 Medium Coking Coal Washeries 3 Non.T 16. Ramgarh & Giridih) Coal Reserves (up to 600 meters) Medium Coking Coal Non-Coking Coal Total Reserves Proved 14.006B. West Bokaro.T 33.562B.

03. Subsequently.Kms COAL RESERVES (UPTO 600 METRES) PRICE DOMESTIC PRICE FIXATION Government of India deregulated the prices of Non-Coking Coal of grades A. Government of India deregulated the price of non-coking coal of grade D. to fix coal prices for grade E.2007 25 . With effect from 01. on 12.2000. Hard Coke and Soft Coke and also allowed Coal India Ltd. Coking coal and Semi/Weakly coking coal on 22.12. B. Pursuant of the above.1997. CIL is free to fix the prices of such grades of coal in relation to the market prices. CIL fixed the prices of deregulated coal from time to time and last such revision has been made on 12.1996. & C. 03.F &G till Jan’ 2000 once in every six months by updating cost indices as per escalation formula contained in the 1987 report of the Bureau of Industrial Cost & Price.01.Total Area of Operation 2600Sq.

Long Flame Coal. Coking Coal. direct feed Coal. & Weakly Coking Coal. Assam Coal for various subsidiaries of CIL are tabled below: Basic Price of Run of Mine Non-Long-Flame Non-Coking Coal (In Rupees/Tone) Field/Co.Long-Flame Coal. Semi Coking coal. A B 1340 C 1120 D 900 E 680 F 530 G 370 ECL(for 8 1490 units vide Annex II) ECL/Mugma 1710 (for 16 units vide Annex IV) ECL/ Rajmahal BCCL CCL NCL SECL MCL 1440 1470 1350 1190 1160 1520 1300 1080 860 640 420 1310 1330 1220 1110 1030 1090 1110 1000 950 860 900 910 840 800 720 890 720 720 670 660 560 760 570 570 530 520 440 610 410 410 390 390 320 26 .Grade wise Basic Price of coal at the Pit-head excluding statutory levies for Run-of-mine (ROM) Non.

In its broadest sense it encompasses all selling activities. in general and CCL. From time to time. To many consumers. with a price and a distribution system appropriate to its target market but if it is unable to reach that market then all its default will have been in vain. The company promotes the buyers by the service. The different distribution medium is also notified to consumer through media to make it convenient for them to buy the right type of coal from the right place and on right price according to their equipment. This means that the rate of promotion in the marketing mix depends on the role of the other elements of the marketing mix. quality. The way various element of marketing mix come together depends upon the marketing objectives of the organization and therefore promotional strategies must be made with reference these objectives. in particular. place and price of coal available for sale.PROMOTION Promotion is the development and discrimination of persuasive communication about the offer designed to attract customers and to persuade them to act. A company may have a well designed product. Spot e-auction is held four times 27 . promotion and selling are synonymous with marketing. There is a lot of promotional activities in CIL. sales promotion and publicity. but promotion certainly represents a large part of the marketing effort. personal selling. but if it is of course only a part of the marketing mix. The service provided to the customer at the time of bidding through spot e-auction and forward e-auction. they do advertise through media regarding the quantity.

Coal Bed Methane (CBM) B. Once in Raniganj and other in Jharia Coalfields approx. 1999 and the project is now under implementation at Sudamdih and Moonidih mines at BCCL.30. of India through has allotted 3 blocks. of India during Sept. but also exploring the possibility of expanding its horizon in harnessing the potential of nonconventional energy source as also to expand its pressure beyond the boundaries of our country. Work is in progress. Petroleum Exploration License for both the blocks has been obtained from respective state Govt. of 356 and 85 sq. already taken in this direction are summarized below: A. 28 . After e-auction date the product dispatch to their customer. First bore hole drilled up to 1059. CIL. CIL ONGC JV: Govt. The various initiatives. of CBM projects: C. Drilling is in progress. The UNDP-GEF project will support recovery and use. the project will introduce advanced techniques of gas resource assessment and recovery and also utilization methods relevant for India Coal-mining conditions. km. CIL has not restricted itself within the conventional gamut of coal mining. WHAT’S NEW New Initiatives taken by Coal India Ltd. The project had been sanctioned by Govt. of India in collaboration with United Nations Development program & Global Environment Facility. UNDP Demonstration project: A demonstration project named “Coal Bed Methane” recovery & commercial utilization has been taken by the Govt. In this respect. with an impressive track record in meeting energy needs by registering a growth in production in excess of 5% annually over the years. is aiming at playing a more purposeful role in establishing itself as the prime supplier of energy to the nation. Through representative demonstration plants.in a month & forward e-auction will be held quarterly for long term requirement of customer. respectively on nomination basis to the consortium of CIL and ONGC. Company registered in MSTC site according to terms and condition. Seven days before buyers have to pay money for the eauction. The present technical assistance project draws on the recommendation put forth in India’s ninth Five year plan recommending the development of new sources of energy. CIL is involved in 2 nos.

2006 by deploying 2 drilling Rigs. New Customer Following are the list of customer:1. CPP (Captive power plant) 6. A total of 3982. CPSU (central/public sector unit) 11. One of CMPDI and one of NEC. Paper 9. 1.Other 29 . A total of 8703.2004 by deployment of 3 Rigs. equitable.12. Chemicals 8. PEOPLE (CUSTOMER) TYPES OF CUSTOMER 1. Textile 10. Fertilizer 4.50 MTs have been drilled since commencement. Steel Industry 2. beneficial to all those users of Coal who do not have official channel to purchase Coal. Brick making 7. either because they are new units or because they were closed down and subsequently revived after fresh efforts and require Coal to start their operation. At Raniganj CBM block. drilling started on 26.05.65 MTs have been drilled since commencement.State agency 12. Power 3. of slim hole drilling from CIL end is complete since 30.At Jharia. Sponge Iron 5. 8 no. CBM related test has been carried out. E-Marketing of Coal The sale of Coal through e-auction scheme is considered to be the most rational system of sale of Coal through which it is at the same time objective. Existing Customer 2. transparent and above all.

PIPARWAR6. saunda. Chainpur SIDINGS Bhurkunda. sayal Gidi A. NORTH KARANPUARA4. churi manki) Rajrappa Washery NR. 3. tarmi. Delhi Jharkhand Bihar Orissa West Bengal Punjab Haryana Utter Pradesh Jammu Kashmir PLACE (COAL INDIA LIMITED) 1. 5. 8. 7. RAJRAPPA7. 7. Jharkhand Orissa Madhypradesh Chhattisgarh Assam Maharashtra West Bengal Utter Pradesh 30 . Gidi washery. 4. Dhori new Jarangdih II Bachara. 6.AREA OF CCL:AREA 1. central. 3. Sirka KDH. saunda. HAZARIBAG 9. 6. RAJHARA5. 8. Gridih Selected dhori. BARKASAYAL2. KUJU8. 2. Dakra PLACE OF DISPATCH (SUPPLY) FROM CCL:1. 2. 5. RCM(Rai. BOKARO & KARGALI10. 9. DHORI11. KATHARAJarangdih I. ARGADA3. 4.

PRODUCTION OF COAL Two types of coal mining are done for extracting coal: 1. Men and material are also transported to the mine through conveyers.079 million tonnes in 2009-2010. INCLINE METHOD By incline method of mining. ii. mud. when two of the major coalfields viz. Dumpers etc. OPENCAST MINING In some areas where coal is available near the surface. Shoves. dumpers etc and then by blasting.e. With sustained efforts company has been achieving its annual growth in production for many years. SHAFT METHOD By shaft method.PRODUCTION. The extracted coal is stocked and periodical measurement is done by the Survey Department which functions under the Production Department. Overburden is also measured and recorded. a shallow hole is dug out and tunnels are made in various directions and coal is extracted from there. The annual production of raw coal which was 15 million tonnes in 1973-74 (the year of nationalization) touched the level of 47. This method is used when coal is present at a depth greater than 10-150 feet. CUSTOMERS 31 . Underground mining is of two types:i. Overburden i. coal is removed through Heavy Earth Moving Vehicles. Men and material are also transported to the underground through lift. which include Coal Cutting Machines. UNDERGROUND MINING In some areas coal is present under deep layers of overburden. After the removal of coal empty place is filled with send. rock etc is first removed by using shoves. 1. came after the re-organization of CCL’s jurisdiction in 1986. This method is used when coal is present at a depth greater than 300 feet. DISPATCH AND SALE CCL has maintained an upward trend in production. For extracting coal present at greater depth mining is done by underground method. coal is extracted and removed from underground through lift. Singrauli in M.P and Talchar in Orissa went out of its jurisdiction with nearly 40% of its annual production. The major challenge of increasing production however. In this method explosives are used to break the surface. opencast mining is done to extract the coal.

HSEB. OTHERS • Cement industries and other Private Parties. UPRVUNL • TVNL (Tenughat Vidyut) Nigam Ltd.JSEB. PRIVATE STEEL PARTIES • TISCO • IISCO & VSP 1. STEEL SECTOR • SAIL (Steel Authority of India Limited) 1. SALE PROCEDURE Types of sale Cash Sale Credit Sale (6 – 7%) (92-93 %) CCL sells coal in cash basically to private parties like: • • • TISCO IISCO VSP 32 As its clear from the table above around 93% of the total sale is made on credit basis.1. In case sale payments are taken in advance before dispatching the coal and payments are taken through demand draft or cheque. • NTPC (National Thermal Power Corporation) • DVC (Delhi Vidyut Corporation) 1. And its only given to Government Parties. PSEB. POWER SECTOR • State Electricity Boards. . DVB. These Government Parties also make payments are taken through demand draft or cheque.

Pay loader WEIGHBRIDGE:1. 3.MODE OF TRANSPORTATION:1. 4. 2. Open cast(32) 2. CHP 2. Underground(31) METHOD OF LOADING:1. 6. 5. Statics 33 . Rail Road Belt Trolley Ropeway Merry go round METHOD OF MINING:1.

In motion RAILWAY ZONE COVERED BY CCL:1. -Gridih East central railway -Rest area SECTOERWISE DESPATCH:- Sector wise dispatch in tonnes. 34 . Central railway 3. South eastern railway-Rajrappa 2.2.

AVAILABLE MEANS OF TRANSPORT 1. The amount of coal to be transported. 2. 5. RAIL Largest user including power sectors may be able to make use of rail transport which is often organized on a Merry Go Round System. by this method has been almost superseded by the kind transport.Every year increase sector wise dispatch in tonnes DISTRIBUTION (METHOD & PROBLEMS) FACTORS AFFECTING CHOICE OF TRANSPORT METHOD 1. 2. The distance to be transported. 3. 4. The facilities at the loading point. The type of coal to be transported. 35 . travels between supply point and consumer. Where the same rolling slack. The commercial vehicle use for this purpose differs mainly in the method of unloading. 3. The access at the consumer’s premises. ROAD Small proportion of coal used by the industries is carried by road. The facilities at the consumer’s premises. 7. designed for rapid loading and unloading. 6. The number of transfers involved which may cause degradation of coal. WATER In the past costal city and inland water ways were used extensively for transportation of coal.

thousand miles away from pitheads. Hence Railways are the most important means of transport of Coal & Coke. It is paradoxical that Coal India has added 6 million tons of coal to its slack. While railways speak man complain of loading of wagons. Railways 2. Coal India officials blame railways for the latter’s inability to supply adequate no. Due to increase in the oil prices the cost of Road Transport has increased which ultimately affects in the increase of the landed price of Coal and Coke. are transporting by truck. Consumers whose requirement cannot be met due the poor wagons supply are constraints to life by road by paying higher prices.PROBLEM IN TRANSPORTATION OF COAL 1. CIL does not encourage the road dispatches due to its certain disadvantages. even when consumers were in distress due to the scarcity of Coal/Coke. Problem in Roadways Transportation According to the estimates made by COAL INDIA about 20% of the dispatches are made by road. 36 . of wagons. CIL officials periodically site instances when the railways send too many wagons to a particularly loading point on a day when workers are always on holidays and the complain in the next day at a press conference about scores of wagons lie unloaded. Passing the buck is a time honored preoccupation of the railways of Coal authorities. The cost of sub stantially higher than the rail freight. Roadways Problem in Railway Transport Currently 75% of the total dispatches are by rail transport. Road transport may not be considered uneconomical within a 100 km radius of pithead . but at a time when factories in North and South India. Energy Policy. the current practice goes completely again the professed intension of the Govt. which aims at minimizing oil consumption and maximizing coal consumption.

’subsidiary companies though FSAs. At present small and tiny consumers in non. captive power plants (CPP) and fertilizer sector 100% of quantity as per the normative requirement of the consumers would be considered for supply of coal .core sector. including independent power plants. (CIL) at fixed price to be declared. For the non-core sector 37 .NEW COAL DISTRIBUTION POLICY As we already know that there are two types of sector i. 3) Other Consumer:75% of the quantity as per the normative requirement of the consumers/actual users would be considered for supply of through e-auction at notified price. The remaining 25% of coal get by e-auction as their preference. through fuel supply agreement (FSA) by coal India Ltd. core and Non-core. the regular’s provisions applicable there to and other relevant factors. 2) Distribution and pricing of coal to different consumers sectors:- Defense sector and railways will get total of the in coal requirement at notified price. The CIL and Govt. If the quantity is more than 4200 tonnes per annum will take coal through Coal India Ltd. whose annual consumption is less than 500 metric tonnes are eligible to get through state agencies is 4200 tonnes per annum. of India approve the new coal distribution policy which is as follows:- 1) Classification of consumers:Classification of consumers into core and non-core has been reviewed instead of each consumer would be treated in merit keeping in view. The units/ power plant which are yet to be commissioned but whose coal requirements has already been assessed and accepted by ministry of coal and linkage/letter of assurance (LOA) approved as well as future commitment would also be covered according. Power Utilizes.e. to be fixed and declared by CIL. internal.

The quantity allocated to this sector may be received on the basis of their performance in the beginning of every year.and annual requirement is less than 4200 tonnes. the fuel supply agreement would be based on firm commitment and compensation for default in performance on either side. then 5% of the value is kept. The agency may charge freight up to 5% Margin as service charge. they have to be entered in FSA by showing satisfaction level document of they to go state guises. 7) Letter of assurance for new consumers:New Consumers from state. 8) E-auction of Coal:38 . All other consumers may be issued LOA by CIL. If EMD failure occurs. CIL may decide a different level. The price charged to such agencies would be same as notified price as applicable to other consumers. Coal India Ltd. Have to be registered under FSA with coal companies by the state Govt. based on various facts. Till further the state Govt. brick kiln etc. For allocation they have to deposit “Earnest money deposit” (EMD). However. 4) Small Consumers & medium consumers:Small & Medium consumer like smokeless fuel. Allocation of quantity is based on consumption pattern in past. 5) Replacement of linkage system by Fuel Supply Agreement (FSA):If the buyers do not maintain continuation in FSA within six months in a year then they may be allocated the coal at auction price. with the approval of board of directors. After issuing letter of assurance they have to enter into FSA and then FSA would be completed within three months. central power utilities. CPPS. Independent power producers. LOA will be valid for a period of 12 to 24 months as applicable and if after paying rejected the order then that amount will be forfeited. Agencies. fertilizer LOA. LOA will be issued by the CIL to the applicant consumers consequent upon payment of EMD to the coal company. are based on prevailing norms and recommendation of administrative ministry. Notified the agency. The amount of EMD could be initially issued at 5% of the value of annual coal requirement. 6) Policy for new consumers:New consumers have to be allocated the coal after issuing letter of assurance (LOA) valid for 24 months for power sector.

SECTOR WISE DISPATCHES OF COAL AND ITS DIFFERENT BY-PRODUCTS DURING THE YEAR 2010-2011( in million tonnes) Sector Raw coal Clean Coal Washed Coal 39 Coal Powder Slurry Rejects .Coal distribution through e-auction was introduced with a view to provide access to coal for such consumers who are not able to source coal through the available institutional mechanisms for reasons like the seasonality of coal requirement. CONSUMER OF COAL Coal is a fossil fuel. MARKETING POLICY Marketing is a very important branch of any organization. Coal Marketing was not much of problem in the past. it is expected that e-auction may help in aerating Spot as well as future market of coal in the country so there is some fresh scheme of e-auction will be introduced. with the liberalization of the economy and easy availability of imported coal by many consumer. c) E-auction should be announced well in advance and be given wide publicity to all consumers who intend to participate. Coal India is perceived to be the synonym of Indian coal Industry. The observation about the global setting of the Coal sector is not fully reluctant in the Indian context. marketing is now playing a very important role in the entire operation activities of CIL/CCL. limited requirement of coal not warranting long term linkage etc. It is used worldwide for generating power and is today one of the largest sources of power generation. say one year. In case of industry due to the monopolistic market scenario. d) In order to address the concerns of such industrial consumers who wish to have an assured supply over a long period. a) Any buyer will be entitled to buy coal under auction. It plays the dominant role in the strengthening of the organization. CIL will earmark a fixed quantity which will be provided to highest bidder/bidders as per bidder’s requirement during the time of bidding. However. Is the prime commercial energy source in India? Contributing over 90% of the total energy reduced and consumed. In long run. b) Coal Companies may be allowed to fix undisclosed reserve price not below the notified price.

Steel Power Cement Fertilizers Sponge Iron Others Total 358 21592 218 945 1448 3628 34.024 1398 1398 34 8026 8060 889 76 965 463 463 194 716 910 OFFTAKE:.THE TOTAL OFFTAKE DURING THE YEAR 2010-2011 WAS 46.288 (in million ) OFFTAKE (Raw coal) Target tonnes) Actual(000 Rail 31249 22315 Road 6001 11709 Internal Coking 3960 3022 40 .

that the impact of govt. Liberalization in our country is still in its initial phase. and its the subsidiary organizations. policy of liberalization shall be felt in its fullest strength. 1. by this period. performance within the Coal industry had also declined. mode for all type of customer including small customers/ traders. the coal industry shall remain in the monopoly position for much as a decade. At present the coal industry is not under a major threat competition even with liberalization of different sectors. The managerial attitudes with ownership.Internal non Coking 8780 9172 Colly Con Total 10 50000 10 46288 COMPETITIORS The post nationalization years saw an increasing coal demand which created monopoly in coal. To provide wider choice of source. grade/ size. It is after this. with a demand for exceeding the level of production of CIL. This is because.. It is expected that carrying on with things as they are today. the private mines shall have positioned themselves in the open market. 41 . OBJECTIVES OF SCHEME To provide equal opportunity to all intending buyers for purchase of Coal/Coal products through single window service. There was little besides distribution of Coal that could be called True Marketing.

cottage industrial sector or any other buyers in distress and also buyers purchasing Coal for re-sale purchases. COAL VIDESH In India. Since.5 MTPA Coal from NEC.CMPDIL has prepared a report on possibilities of producing 3. it has been proposed to from a separate subsidiary company “Coal Videsh”. Coal India proposes to increase allocation of Coal under e-marketing. With this objectives. 3. demand of coal is increasing at a faster rate. CIL and OIL held a meeting to discuss future possibilities on July 11. non-linked consumers with snapped/ lapsed linkages. where such coal is available. customer requiring Coal above their specified permissible quantities. Indonesia and Russia. techno-economically recoverably reserve of good quality coking coal and high grade low ash non-coking coal are not adequate to meet indigenous requirement and thus import of such coal has been resorted to bridge the gap. COAL LIQUEFACTION Oil India Limited had approached CIL to become a partner in its venture of producing oil from coal in its Duliajan plant in Assam and requested for supply of about 3. Buyer can get access to Coal at self-determined prices. To evolve a market-driven Coal pricing mechanism through inter play of market forces demand and supply by shifting away from administrative price regime. 4. seasonal consumers such as brick manufactures. so that the market mechanization of price determination based on supply and demand is judiciously established. To provide a legitimate channel of supply of Coal to an ever growing no. consisting of multi-disciplinary team has been opened in CIL. SSI & tiny industries.5 Mt/annum of coal from NEC. CIL Board has approved the proposal which needs approval of Govt. Mozambique and Zimbabwe to explore strategic business opportunities in these countries.2. to facilitate bridging the gap. Meanwhile. of outlets across the country for all customer s through customer friendly system of sale of Coal/ Coal products making use of modern technology. if any. 5. The team has started visiting South Africa. CIL is also actively pursuing business intelligence activities by closely tracking the business opportunities in Australia. 2005 wherein OIL 42 . of new industries. a dedicated “Coal Videsh” dept. To facilitate creation of large no. it is felt necessary that CIL should venture for coal mining abroad.

examine possibility of formation of 2 Joint Ventures. gasifying the coal and bringing the product gas to surface through boreholes grill from the surface. Switchover – Categorization of Coal from UHF to GCV 43 . MOC includes the scope of work for this JV in the field of over ground Coal Gasification. A draft memorandum of corporation (MOC) has been drafted. Power Plant CIL is also contemplating setting up of power plants in JV. has already been taken up. The gas is used for power generation. GAIL (India) Ltd. CIL and GAIL have taken up drawing of a road map to accomplish the objective jointly in right earnest. CIL and ONGC are likely to take up jointly a pilot project for establishing UGC technology. 1 for Coal production and other for setting up of Coal liquefaction plant and its upstream activities (IOCL may be considered as a party for the letter).a.5 MT p. Initial work of data exchange. 2005. A MOU has been signed between CIL & ONGC ON 3rd Nov. needed for identification of trial site. Further drilling for additional data generation is one of the prospective which is been taken up.indicated that the tentative cost of production of oil obtained from this process is US $ 35 per barrel which appears to be quite attractive particularly in view of the burgeoning oil price in international market which has reached up to US $ 65 per barrel. and finally suggest a road map for implementation of proposed JV’s. 2005 in connection with their interest to make a JV with CIL for evaluation of work in various Coal sector related potential opportunities. with both NLC & NTPC for power plant in Orissa. May director (Technical) Coal India Ltd. Underground Coal Gasification (UGC) UGC is the in-situ gasification of Coal in the seam. It has decided to form a “Joint Task Force” of CIL which would study the CMPDI report for possibility of Coal production of 3. In this connection. It is achieved by injecting oxidants. Coal India has given high priority to the issue of UCG. CIL is in negotiation. industrial heating or as chemical feedback. from NEC and examine enhancement of schedule of production . Over ground Coal Gasification (OCG) Director (Planning and business development). On 20TH July.

Considering significant role of telecommunication and IT in providing a proper decision support system at area level. The application s/w has been developed and implemented at CIL and its subsidiary (HQ’s). Necessary infrastructure preparation has been carried by respective subsidiary and implementation is in progress. Application S/w an integrated solution. The same is being upgraded for faster access of application data. CIL has been and MCL) for implementation of Coal Net application Software. projects. 44 .Efforts are being made to assess the possibility of making the categorization of Coal from UHF basis to GCV basis. Telecommunication links have been set up over satellite media (VSAT systems) and leased lines of BSNL interconnecting CIL HQ’s. COAL NET Coal India had taken initiative in development and implementation of COAL NET. regional stores. Initiative has been communication. Subsidiary HQ’s and Mock for voice. data and video conferencing in an integrated manner for seamless flow of information over the network. to bring uniformity across its subsidiary companies and entrusted the activities to IIT. Necessary LAN has been set up at respective subsidiary (HQ’s) for COAL NET s/w. Kharagpur in the year 2001. Coal loading points etc. Trials are being conducted at MCL & NCL results of which are yet to be obtained. Similar rollout of from Subsidiary HQ’s to area offices.

ANALYSIS & INTERPRETATION 45 .CHAPTER 5 DATA PRESENTATION.

1. SL. Which method according to you is the most preferred way of Transportation. SL. Q.DATA ANALYSIS Q. RESPONSE A B TOTAL NO OF RESPONDENT 40 20 60 PERCENTAGE OF RESPONDENT 66.6% through cash sales.NO.What according to you should be the most preferred way of the sales of coal. RESPONSE A NO OF RESPONDENT 30 PERCENTAGE OF RESPONDENT 50 Rail B C TOTAL Road Water 15 5 60 25 8.3 100 Credit sales Cash sales From this graph we concluded that most preferred the way of sales of coal through credit sales 33.6 33.NO.3% and 16.3 100 46 .2.

3% preferred through Water . SL. Q.3.As per this graph 50% of respondents prefer Rail for transport of coal and 25% preferred Road and and 8.4. Do you think that price of should be decrease according to need of coal? 47 .Which method according to you is the most preferred way of extracting method of coal by CCL. Q. RESPONSE A B C TOTAL Shaft Method Incline Method Opencast Method NO OF RESPONDENT 30 15 15 60 PERCENTAGE OF RESPONDENT 50 25 25 100 From this graph we conclude that 50% of respondents preferred Shaft Method and 25% Incline Method of and 16.NO.6% through Opencast Method.

What types of coal did you prefer? SL.SL.NO.5.3 100 48 . Q. RESPONSE A B C YES NO CAN’T SAY NO. RESPONSE A B C D TOTAL Coking coal Semi Coking Coal Non Coking Coal Others 60 NO OF RESPONDENT 35 15 5 5 PERCENTAGE OF RESPONDENT 58.3 25 8.3 8.NO. OF RESPONDENT 15 30 15 60 PERCENTAGE OF RESPONDENT 25 50 25 100 TOTAL From the above graph we conclude that 50% of the respondents says that price of the coal should not be decreased while 25% of the respondents says that it should be decreased and 25% can’t say anything.

6 100 As per this graph we conclude that 41. SL. Q.NO. 49 . RESPONSE A B C D TOTAL Fully satisfied Satisfied Not satisfied Can’t say NO OF RESPONDENT 25 15 10 10 60 PERCENTAGE OF RESPONDENT 41.C.3% Non Coking Coal and others. Q.L.6 16.3% of respondent prefer Coking Coal and 25% Semi Coking Coal and 8. Are you satisfied with the price of Coal by C.6% of respondents are not satisfied with the price of Coal by CCL and 25% are satisfied and 16. Are you satisfied with the Policy formulation and advisory functions by the CCL.6 25 16.From this graph we conclude that 58.7.6.6% are fully satisfied or can’t say.

Q.3% are can’t say.8. RESPONSE A B C TOTAL you did.NO.3 100 50 .SL.Do you realize that your competitors probably answered NO to even more questions than SL. OF RESPONDENT 35 20 5 60 PERCENTAGE OF RESPONDENT 58. OF RESPONDENT 25 30 5 60 PERCENTAGE OF RESPONDENT 41.6 50 8.3 8.NO. Yes No Can’t Say NO.3% of respondents are satisfied with Policy formulation and Advisory of company and 33.3% are not satisfied and 8.3 100 From this graph we conclude that 58.3 33. RESPONSE A B C TOTAL Yes No Can’t Say NO.

6 33. SL.6% respondents agree with policy for new customer and 33.Are you satisfied with Policy for new consumers? As per this graph we conclude that 66. OF RESPONDENT 40 20 60 PERCENTAGE OF RESPONDENT 66.3 100 Q.3%says can’t say.From this graph we conclude that 41.NO.6% of the respondent says that yes and 50% says no and 8. RESPONSE A B TOTAL Yes No NO. 51 .9.3% are disagree.

10.NO.6% respondents satisfied with Reorganization & reconstruction of coal mines and 33. Yes No NO.3% are disagree.Are you satisfied with Reorganization and reconstruction of Coal mines taken over by SL.6 33. OF RESPONDENT 40 20 60 PERCENTAGE OF RESPONDENT 66. RESPONSE A B TOTAL Government.Q.3 100 As per this graph we conclude that 66. 52 .

Fertilizer.CHAPTER 6 FINDING & CONCLUSION FINDINGS a) Consumers are classified into two types – New customer and Existing customer.power sectoer. b) Requirements of defence sector.IPP. 53 .railways will be met in full at notified price.

g) The percentage availability of non-coking coal is 58%. CONCLUSION 54 .c) Other FSA consumers get 75% of the quantity as per the normative requirement of the consumers’ actual supply of coal requirement and rest of the 25% will be sourced by them through e-auction/import of coal etc. e) Non coking coal is more available in according to given data. i) The letter of Assurance (LOA) to be issued now pursuant to the new policy will have a validity of 24 months for consumers/applicants of power utilities. f) The percentage availability of coking coal is 42%. d) Distribution of coal is done by railway and roadway from CCL. h) Grade A coal’s quality is the best among them. The system is already vogue. j) Supply of coal to steal plant would be based on FSA. The price of Coal would be on the basis of coal import parity prising with suitable adjustment for quality. That’s why it’s price is more than other grade of coal.

The profit is also good but profit not shown of maximum. As this is very good aspects that is under the govt. BIBLIOGRAPHY & REFERENCE 55 . As I want to say something about the price release for the coal to the buyers. Per tonne price is very cheap and the buyers release the products at maximum price. The Company also takes positives decision that is not involves in service to the buyers like transport. If it is the under the private sector then he create monopoly in country. material handling Logistics supply chain etc.Coal India is the third large coal producing Country. of India. It gives opportunity to 4. company gave time to receive the coal within 45 days. As it is very good because company release a highest price than the coal related products like electricity price is more. The coal distribution policy is very effective and auction is very interesting for the buyers.25 lakh employees and their needing facility. It also contributes in shaping the country by paying tax.

Books:I.in II. Departmental reports & Data 56 . www.coalindia.nic. Websites:I. Marketing Management.google.com Reports:I.in III.ccl.nic. www. www.By Philip Kotler.

Master your semester with Scribd & The New York Times

Special offer for students: Only $4.99/month.

Master your semester with Scribd & The New York Times

Cancel anytime.