ICVL eyes stake in Australian mining firm

International Coal Ventures (ICVL), a special purpose vehicle (SPV) formed by five leading PSUs to scout for coal properties abroad, is eyeing equity stake in an Australian mining firm, SAIL Chairman S K Roongta said today.

"Some mines in Australia are being looked at. We are looking for an equity stake... We are at it," Roongta told reporters on the sidelines of a conference here.

Without identifying the mine in which the SPV is eyeing stakes, the SAIL Chairman said, "We are looking for coal mines wherever it is logistically possible to import coal in India."

Industry insiders said ICVL, the SPV of SAIL, RINL, CIL, NMDC and NTPC, is in the process of picking up over 10 per cent stake in Australian mining firm Gloucester Resources.

Through its merchant banker Merrill Lynch, ICVL had, over a month ago, bid for a minority holding in Gloucester, but the offer was rejected over valuation, an official source said.

"They (Gloucester Resources) have now asked ICVL for a counter offer, which the SPV's board is considering," the source added.

It may cost ICVL about $1 billion to clinch the deal with the Australian coal company, the source said.

The Indian SPV may also try for more stake in Gloucester, once it is through with the initial deal, the source said.

An in-principle understanding has been reached between ICVL and Gloucester for supplying 50 per cent of the coal off-take from the proposed greenfield project to the Indian SPV, irrespective of the equity sharing pattern, he added.

Gloucester Resources operates a sizeable coal block in New South Wales with reserves of around 450 million tonnes of coking and thermal coal. It is in the process of setting up a greenfield project in Gloucester, over 300 km away from Sydney.