State-owned Coal India Ltd (CIL) has shortlisted US firms Massey Energy and Peabody Energy, besides Indonesian Novem/Sinarma, for a possible partnership to take forward the about $2 billion (over Rs 9,000 crore) overseas ventures.
The world's largest coal producer will soon start due diligence at five mining assets of the global firms, spread across Australia, Indonesia and the United States.
CIL chairman Partha S Bhattacharyya had already named Peabody Energy as one of the shortlisted firms, out of the 59 proposals it received from global firms for its Expression of Interest. The navratna firm is currently considering equity buyouts and joint venture mining with these firms.
"A team of two CIL officials will undertake due diligence of mining assets of the Massey Energy Company in US, Peabody Energy in Australia, and Novem/Sinarma in Indonesia. They are expected to leave shortly," a senior Coal Ministry official told PTI.
The team is expected to visit Peabody Energy's Metropolitan Under Ground Mine and Wilkie Creek Mine in Australia; Novem/Sinarma's Borneo Inclobana and G 3 mines in Indonesia and Massey Energy Company's Sidney Underground Mines in the US.
CIL will finalise "at least" one deal in the next few months, the official said.
"CIL has already appointed merchant bankers and technical consultants for the proposed JV projects," another official in the know of the development said.
For Peabody Energy's Australian assets, CIL has appointed DSP Merrill Lynch as the merchant banker and Minarco Mineconsult as the technical partner. Similarly, the coal firm has given the task of evaluating Massey Energy's assets to the Royal Bank of Scotland, and roped in Marston and Marston for technical assistance.
For the assets of the Indonesian firm, CIL has appointed the Royal Bank of Canada as the merchant banker and IMC Group as the technical consultant.
Coal India has built a war chest of Rs 6,000 crore for foreign ventures this fiscal, Bhattacharyya had said last month. The PSU expects to import 50 million tonnes per annum (MTPA) of coal from such projects in the next few years to meet the domestic demand.
In the current fiscal, CIL expects coal imports to increase to 100 MT, from 80 MT in 2009-10.
CIL, which is sitting on a cash pile of over Rs 30,000 crore, does not need to raise funds for its growth projects.