Professional Documents
Culture Documents
Islamabad
Submitted By:
Mohammad Farooq
Muhammad Khalil Hussain
Muhammad Zubair Abdullah
Muhammad Younus Balti
Shafqat Balti
PMDC has four salt and four coal projects in Pakistan, out of which three salt mines in
are located in Punjab and one in NWFP, as for coal mines three coal mines are situated in
Balochistan, one coal mine in Sindh. All these mines are called PMDC’s operating
projects and have no separate legal entity. PMDC has also two subsidiary company one in
the name of Lakhra Coal Development Company (LCDC) operating a coal mines in
Sindh in which PMDC owns 50% shares while 25% each is owned by Government of
Sindh and WAPDA respectively and another in the name of Sarhad Mineral Limited
(SML) operating a salt mine in NWFP in which it has 49% Authority (Government of
NWFP). At the same time PMDC has investment in development of soap stone and coal
projects in Federally Administrative Tribal Areas (FATA) areas as a joint venture partner
with FATA Secretariat of Governor NWFP. Similarly it has profit sharing agreement with
Chinese Company who is developing Duddar Lead Zinc deposits in Balochistan. PMDC
projects have not a separate legal entity. All employees working in the projects are
appointed by the PMDC. Funds requirements of the projects are also met by PMDC Head
Office against sales revenues generated from the sale of salt and coal. Prior to 1999,
PMDC was facing liquidity crunch and was at the brink of collapse. It had offered some
projects for sale at that time, the GOP would have got nothing and instead has to
contribute from its kitty to pick up its loan liabilities and discharge the liabilities of
employees and others. In the following years PMDC has turned around in a big way by
increasing its productivity significantly and has now emerged as a progressive
organization.
Organization Chart:
Managing Director
GM DGM GM GM GM GM GM
(P&D) (Audit) (Salt) (F&A) (A&L) (Mktg) (Coal)
(Med)
The existence and extraction of salt dates back well before the Christ Birth (B.C).
“Celokas” who was a General of the Alexander the great’s army has mentioned the
mining of salt in this area in 327 B.C. Emperor Akbar mentioned the trade of Salt Range
salt in “Ain-e –Akbari. The Mughal and former rulers were collecting revenue from this
source, which continued till Sikh regime. The salt mines changed hands from Mughals to
Sikhs in 1809 AD and salt became one of the 48 commodities.The whole of Salt Range
had gone under the Company with the annexation of Punjab in 1849. Initially this mine
was given under the administrative control of the Punjab Salt and Custom Department,
but in 1869-70 it was handed over to the Inland Custom Department (Central). In 1947,
after partition, the Excise & Taxation Department, Government of Pakistan took over
these mines and with the passage of time these mines were controlled by various
department namely Bureau of Mineral Resources, WPIDC and finally these were
transferred to PMDC in July 1974.
In the year 1885, Dr. Warth introduced the scientific Room & Pillar method of salt
excavation, the then Chief Engineer, which is still in vogue in Main Mine. In the past
there were track line mounted activities in Main Mine, but to curtail the expenditure on
production of rock salt, the system has been changed to trackless mining during the
month of July, 2002
The mining area is divided into two sections i.e. Main Mine and Jansukh Mines. The
excavation of rock salt from Main Mine at Warcha is carried out through Registered
Miners and from Jansukh Mines through raising contractor. There are 102 Registered
Miners at this project and they work under the supervision of 7 Nos. Gang -men. These
Gang-men/Registered Miners have been restricted only in Main Mine, Warcha. But in
Jansukh area, the raising contractors have been allotted various Mines for the excavation
contract of rock salt.
Main Mine located behind the Kalabagh city near village Wanda Kukranwala and bank of
River Indus.
Drift Nos. 12, 13 and 14 located in Kalabagh city at Zero Point.
Mari Mines located near old Mari village Tehsil & District Mianwali
PMDC is holding 2 leases for mining of rock salt from the area.
Mining Lease of Main Mine and Drifts 12, 13 and 14 over an area of 2649.7 acres.
PMDC has applied for third lease at Katacha Bangi Khel to the Licensing Authority,
Govt. of Punjab.
The transportation of salt is through mules from deep chambers in the main mine up-to
the lowest level and then through haulage. In other sections, it is exclusively through
mules.
There is no Chemical Industry at or around Kalabagh as ICI at Khewra and Olympia at
Warcha, therefore the major quantities of salt are sold to the salt dealers. A small quantity
is, however, supplied to P.O.F. Wah and Pakistan Atomic Energy Commission.
Bahadurkhel Salt Quarries are situated about 80 K.M. from Kohat , 48 Km from
Bannu, 32 Km from Karak district and 156 K.M south of capital of NWFP.. It lies on
topographic sheet No.38-O/4.
The British took the Kohat quarries in the year 1849. Before the British rulers, these
quarries were held by local Chieftains who were paying a nominal payment to the Sikh
rulers. The British government selected 13 Maliks from Charpara, Bahadurkhel and
Darish Khel villages for excavation of salt. Bahadurkhel Salt Quarries are the biggest
quarries of NWFP. Maliks of these villages arranged Miners for excavation of rock salt
from these quarries and British Govt. paid an extra amount after excavation of 100
Maunds salt (Salmani). The British Govt. fixed salmani for the Maliks in 1942.
It is further stated that when any one among the Maliks or Salmani Holder dies their legal
hairs occupy the salmani charges.
Jatta salt quarries are situated 100 K.M south on the Indus Highway from
Peshawar, 32 Km from Kohat city and 32 Km from Karak city. The area lies on
Topographic sheet No. 38-K/4.
Karak Salt Quarries are located 138 K.M south on the Indus Highway from
Peshawar and 5 Km away from the Karak city. The area lies on Topographic sheet No.
38-O/4.It is smallest section of Jatta/Bahadurkhel Project.. There are three underground
mines, one main mine is presently running departmentally and other two through
excavation contractors. The sale price of Karak salt is Rs.107/- per tonne and we are
paying Rs.30/- per tonne to the salt cutter on departmental mine and Rs,67/- per tonne to
the contractors from the above price of salt.
As explained earlier, PMDC has four salt and four coal projects. Its basic function
is to searvh for minerals, explore, develop and develop and exploit the minerals of al kind
including copper, lead, zinc, coal and salt. It is extracting these minerals and selling it.
From there it is generating revenue. Also PMDC has two subsidiaries one in the name of
Lakhra Coal Development Company operating a coal mine in Sindh in which PMDC
owns 50% share while 25% each is owned by Government of Sindh and WAPDA. As the
50% shares are owned by PMDC, so it is holding the management of LCDC. Its
managing director is the employee of PMDC. Another subsidiary is in the name of
Sarhad Mineral Limited operating a salt mine in NWFP in which it has 49% Authority
(Government of NWFP). At the same time PMDC has investment in development of soap
stone and coal projects in FATA areas as a joint venture partner with FATA Secretariat of
Governor NWFP. Similarly it has profit sharing agreement with Chinese Company who is
developing Duddar Lead Zinc deposits in Balochistan. PMDC projects are not a separate
legal entity. All employees working in the projects are appointed by the PMDC. Funds
requirements of the projects are also met by PMDC. Head Office against sales revenues
generated from the sale of salt and coal. Prior to 1999, PMDC was facing liquidity crunch
and was at the brink of collapse. Had it been offered for sale at that time, the GOP would
have got nothing and instead has to contribute from its kitty to pick up its loan liabilities
and discharge the liabilities of employees and others. In the following years PMDC has
turned around in a big way by increasing its productivity significantly and has now
emerged one of the progressive organization. So it is cleared that its basic operation is
the production of salt and coal and then sale of it at a price so that it can earn a profit after
deducting all the expenses.
OPERATING PROJECTS OF SALT
Khewra Salt Mines:
Warcha Salt Mines
Kalabagh Salt Mines
Bahadurkhel Salt Quarries
Jatta Salt Quarries
Karak Salt Quarries
OPERATING PROJECTS OF COAL:
Sharigh Coal Project
Sor Range Coal Project
Lakhra Coal Project
Degari Coal Project:
LONG TERM SUPPLY AGREEMENTS:
Products:
The major products of PMDC are coal, salt, zinc, silica and lead. After producing the coal
and salt it sells them. Also they have many by products like salt show pieces and salt
lamps which are very popular all over the world. The salt of PMDC is popular in batter
quality all over the world. The coal of better quality in Pakistan is also produced by the
PMDC. PMDC is well known in its products all over the Pakistan as well it is famous in
many countries.
Services:
Although the basic function of PMDC is to produce not to serve, yet it is
providing its services to the visitors visiting PMDC salt mines Khewra tourist resort. The
tourist resort of PMDC is shown in a pamphlet appended below this project.
Contribution towards government:
PMDC is contributing its funds toward the government. The major amount
is the dividend and the tax. It is paying tax every year from its operations. Also it pays
dividend to the government of Pakistan. PMDC is based upon self sustained basis yet it
contributes in GDP.
Problems and Solutions:
There are some problems which PMDC is facing and also the solutions for these
are prescribed under that.
(1) Privatization:
PMDC is on the hit list of privatization by Pakistan Privatization
Commission. It could be privatized soon. Due to this process of privatization,
organization cannot start new projects as well the employees are more concerned
with their future. Organization is not taking the risk of opening new projects and
to invest huge amount on development of projects as well as on research, because
it will increase the expenses of the company and also it affects on the liabilities of
the company.
Solution:
We suggest that the problem of privatization should be solved by the new
government and if it is not going to privatize then the government should give
surety, so that they can invest on new projects and also to make research more. As
for employees they will work with full attention and devotion.
(2) Competition with Private sector:
PMDC is facing a problem of competition with private sector. As private
mine lease holders are producing/ extracting minerals at a low cost and they sold
at a price which is near equal to the cost of production of PMDC. So it is difficult
for the PMDC to compete with them. The reason for the high cost of production
of PMDC is the use of obsolete method of production and it employees a large
number of people to which they give certain incentives and paying a huge salaries
and wages, it is its administration cost.
Solution:
Organization should compete with private sector. They can
compete if they reduce their cost of production. They can reduce their cost of
production if they use the advanced method of production and new machineries
and technologies, also they should employ the persons as much they have needed.
Furthermore, the abilities of marketing department should be improved, and
marketing managers have less potential to face this problem. Marketing manager
need to overcome this problem by new ideas and marketing techniques.
Inherited rights to 685 miners:
At the time of independence, the British’s transferred some working rights
to the 685 workers at Khewra salt mines and 28 miners in Kalabagh salt mines
and some in Warcha project and other. which were the employees in mines at that
time and when Pakistan came into being, that rights also acquired legal status.
After the formation of PMDC it faced a problem by them, as they have the rights
in production the PMDC had to pay and is paying a huge cost to them for the
extraction of salt at Khewra project. The organization can not use machinery at
that projects, if it do this then there are strikes by the trade-ism unions and they
harm organizational resources. In 1999, PMDC has done the same practice and
there was a strike by the unions and they burnt vehicles and buildings of the
organization.
Solutions:
The project managers take a step to overcome these problems. The
manager should negotiate with these Miners who have Right from the British
Government. Managers satisfy them that Mechanization and Mass production is
not against their Rights.
(3) Overall cost increases:
PMDC have employed large number of employees. These employees are
given many facilities like health, children education, scholarships etc.
Organization has also health units and educational institute. Asthma hospital and
Survey College in Khewra (Jehlam) and Survey College in Makarwal are also
working.
Solution:
The overall cost is not a problem for the PMDC. Most of organizations
provide these facilities to their employees or those people where organization
operates their projects.