ICVL close to acquiring Australian coal assets

International Coal Ventures Pvt Ltd (ICVL) has not given up hope of acquiring coking coal assets in Australia, though its bid for Riversdale Mining failed to materialise. Talks to acquire coking and thermal coal assets in other Australian mines are believed to be in the final stages.

A delegation, comprising Steel Secretary P K Misra and Steel Authority of India Ltd (SAIL) Chairman C S Verma, is in Australia to close the negotiations and secure a deal.

“Very soon, the consortium would be able to secure some significant assets that would address the rising demand … it has already completed due diligence on Queensland and New South Wales assets. Talks are almost in the final stages,” said an industry official, on condition of anonymity.

In January, the consortium had backed out from making a counter offer to Rio Tinto's $3.9-billion bid for Riversdale. Since its formation in 2009, ICVL has not been able to lap up any significant deal.

ICVL recently signed a memorandum of understanding with the Indonesian government for development of mineral deposits, setting up of mineral processing facility, steel plant and required infrastructure in the province of Central Kalimantan. It gave a bid for a Mongolian coal mine on January 31. It is also scouting for mines in Mozambique.

It was formed with the objective of acquiring 500 million tonnes met coal reserves by 2019-2020, to ensure imported coal supply of at least five million tonnes per annum from assets overseas as medium-term target by 2011-12 for SAIL and Rashtriya Ispat Nigam Ltd (RINL) and to meet requirements of other member entities — Coal India Ltd (CIL), NTPC and NMDC.

The ICVL board is empowered to make investments up to $300 million. However, proposals exceeding this limit would be taken up by an empowered committee of secretaries for directly seeking the approval of the Cabinet. SAIL and CIL hold 28.5 per cent each in ICVL, while RINL, NMDC and NTPC own 14.29 per cent each.