The coal mining in Surghar Range was started during 1913 by driving inclines from outcrop of the coal seam. After formation of Pakistan it was declared as an evacuee property and ultimately assumed by the Federal Government in 1949. The mines were transferred to Pakistan Industrial Development Corporation (PMDC) in 1954.
PIDC undertook a major development programme with USAID funding, and the services of foreign experts were acquired for the development of coal mines at greater depth. A scheme costing Rs. 16.7 million was executed between 1956 to 1965 for this purpose. This scheme was targeted to increase the annual production capacity to 300, 000 tons per annum. The proposed target could not be achieved due to major geological disturbance/fault known as main Makerwal. A maximum production of 218, 000 tons was achieved in 1967-68.
MCL was transferred to PMDC in 1974. PMDC initiated a major investment programme to replace the old worn out machinery. An expenditure of Rs. 24, 308 millions was made develop drivage into coal seam. In 1995 the MCL was privatized by the Privatization Commission of Pakistan.
At the time of privatization of Makerwal Collieries Limited the proved reserves of coal were negligible and such no future planning could be done unless and un till the geological investigations are carried out to establish the coal services and wages were arranged either from loan or sale of project assets. The deep sealed reserves below water level, lack of proved reserves over employment at the project was the main hurdles in the way of efficient operation of the project.
The company had not been profitable for the last ten years. PMDC had been providing financial assistance since 1983 and as of late, the Privatization Commission was paying employees salaries. Due to recurring losses and insolvency the compnay was not a GOOD CONCERN. The project was not financially viable under the present status.
Keeping in view the heavy losses the government decided to privatize the Makerwal Collieries Limited which was not viable in any circumstances except a huge investment alongwith technical expertise. This has been proved true that the present management being the very much in the mining business since long, we acquainted with the local politics, financially very sound - could hardly make the project at break even after five years - though they have raised the production to 8 times.
