On Monday, Coal India said its capital expenditure for June 23, 2022, quarter rose 64.8% to Rs 3,034 crore, on the back of land acquisitions at its coalfields and enhanced transport infrastructure under the first-mile connectivity project.

Coal India’s capital expenditure for the April-June period of the last fiscal stood at Rs 1,841 crore.

“Coal India Limited (CIL) recorded strong year-on-year growth of 65% in Q1 FY23, maintaining the rapid growth in capital expenditure (Capex) in Q9,” it said in a statement.

Land acquisitions of Rs 608 crore accounted for nearly a fifth of the Capex basket in the first quarter. This is nearly 2.3 times the Rs 268 crore spent under the project between April 2021 and June 22, 2021. Expenditure is distributed to all CIL subsidiaries.

“The increase in Capex was due to our strong spending on coalfield land acquisition and transport infrastructure development under the First Mile Connectivity (FMC) project. These two important areas have helped CIL expand its mining operations to accelerate production and increased closely without seam transportation,” said a senior company official.

FMC is an initiative by coal companies to minimise environmental pollution, and coal is transported by conveyor belts from coal processing plants to silos for loading.

Capex for constructing coal processing plants and silos (including weighbridges) under the FMC project totalled Rs 577 crore during the quarter. The figure is much higher compared to Rs 141 crore in the first quarter of the previous fiscal.

The cost of laying railway lines and corridors stood at Rs 571 crore in Q1FY23, up 57% year-on-year.

The official said: “The production rate of CIL has maintained a sustained double-digit growth in FY23, and all efforts continue this trend. It is important to have a matching evacuation infrastructure that can handle the increase the transport of the output”.

Even during the COVID-19 slowdown, CIL has seen steady quarterly growth in capital expenditures. CIL accounts for more than 80% of domestic coal production.