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| CIL may develop coal assets with Australian mining firms |
| Jayajit Dash / Kolkata/ Bhubaneswar Aug 06, 2009, 00:22 IST |
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After being awarded two exploratory coal blocks in Mozambique in March this year, state run Coal India Limited (CIL) has now stepped up its efforts to acquire overseas coal assets in Australia.
CIL has called for expressions of interest from mining firms in Australia in this connection by the end of August this year. The coal major was keen on entering into a strategic partnership with the Australian mining firms having proven expertise in mining for developing the coal assets.
Confirming the development, Partha S Bhattacharyya, chairman of CIL said, “We are aiming at a strategic partnership with the mining firms in Australia. CIL is planning to acquire both thermal and coking coal assets.”
The navratna coal firm was open to acquire virgin as well as operational coal mines in Australia.
Apart from Mozambique and Australia, CIL was also looking to acquire coal properties in US, Indonesia and South Africa. These acquisitions were likely to be carried out through Coal Videsh Limited, the overseas arm of CIL.
CIL has also formed a special purpose vehicle called International Coal Ventures Limited (ICVL) with four other state run firms for acquisition of overseas coal assets.
The four other state run firms in ICVL included Steel Authority of India Limited (SAIL), National Thermal Power Corporation Limited (NTPC), National Mineral Development Corporation (NMDC) and Rashtriya Ispat Nigam Limited (RINL).
The race for acquisition of overseas coal assets was gaining momentum in view of the burgeoning coal demand in India. The domestic coal demand is projected at 730 million tonnes (mt) by 2011-12 but domestic coal production is expected to reach 520 mt by then, thereby creating a shortfall of over 200 mt.
It may be noted that in March this year, CIL was awarded two exploratory coal blocks- A1 and A2 in Tete province of Mozambique having an estimated reserve of one billon tonnes.
CIL is in negotiations with the Mozambique government for carrying out exploration work on the two coal blocks.
The coal major would forge a joint venture (JV) with the Mozambique government for exploration of the coal blocks. In the JV company, CIL will have 85 per cent stake with the remaining 15 per cent going to the Mozambique government.
While the exploration of these two coal blocks spread over 224 sq km was set to commence within a few months, the mining activities are expected to begin after three and a half years.
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