Central Coalfields awards Rs 9,294 crore mining project to Power Mech
Power Mech Projects Limited, a Hyderabad based industrial services construction company said on Monday, it has received a contract of Rs 9,294 crore for Mine Development & Operation (MDO) project from Central Coalfields Limited (CCL).
As part of the Centre’s asset monetisation drive, the ministry of coal along with national miner Coal India Ltd (CIL) Neyveli Lignite Corporation (NLCIL) will offer 60 projects worth Rs 41,042 crore for private investment. This includes 17 MDO projects to be offered to private companies, this paper reported recently.
MDO is contractual mining under which the contractor earns revenue from production of coal mine operations.
CCL is one of seven subsidiaries of CIL. The project has been awarded to a consortium of Power Mech Projects Limited AMR India Limited wherein Power Mech is the consortium leader with 74 per cent equity stake AMR India will hold 26 per cent stake, the company said in its BSE filing.
The said MDO contract would entail mine infrastructure development, removal of overburden extraction of Coking Coal, processing, crushing transportation of coal up to washery of CCL, carrying out R&R activities.
The project pertains to Kotre Basantpur Pachmo open cast coal mine located in Ramgarh Bokaro Districts of Jharkhand.
Power Mech in its public statement said the project has a total coal extraction capacity of approximately 105 million million tonne (MT) with an annual capacity of 5 million MT. The contract period is for 25 years, extendable by 10 years.
“This project will strengthen the already robust order book evenfurther enable the Company to diversify its order book which is in line with its strategy to have an optimum mix between power non-power segments. Once operational, the project will add more than Rs 400 crore annually to our top line. With the revenue coming in from the O&M business this MOO projects, we expect to witness sustainable revenue with higher margins in the future for a longer period,” said Sajja Kishore Babu, Chairman Managing Director, Power Mech Projects.