Friday, 29th July,
According to the officials, Coal India, “Coal India, which is in advanced talks with Indonesia’s Golden Energy Mines, is set to ink a deal worth $1 billion.” The world’s largest coal miner, Coal India, is seeking approval from the Indian government to buy a 30% stake in this Indonesian Coal mine. By the Indian Government, it is restricted to buy a stake in any unlisted asset globally. But Coal India has sought approval for the stake buying.
“We have sought government clarification on buying stake in an unlisted asset of a listed firm. The issue is that the entity is not listed. We are only allowed to buy in a listed firm,” said Coal India chairman N.C. Jha.
Indonesia’s PT Golden Energy Mines is a coal producer that is 99% owned by PT Dian Swastatika Tbk, an energy and infrastructure company, that is set to upgrade its production capacity to 5-8 million tons this year. Reports indicate that the firm intends to increase production to 10 million metric tons per year to 4,200 to 5,300 kc/kg coal this year from 3 million in its Sumatra and Kalimantan mining companies.
The Indonesian government has already confirmed that Coal India is set to invest up to $3 billion in the mining sector, steel and ports in Kalimantan.
Coal India is the state-owned monopoly coal producer in India. The firm has also been in talks with U.S. based Massey Energy and Peabody Energy to buy stakes in their unlisted mining units.
All of last year, Coal India failed to make any headway in its overseas acquisition plans. It currently owns two new projects in Mozambique. The company had earlier said it was looking at five overseas proposals for equity infusion in countries such as United States, Australia and Indonesia.
Several delays have scuttled the company’s plans of increasing local production. The company supplies 80% of the coal India requires, but has been facing difficulties in getting the necessary clearances for their buys. The huge 142 million metric tonne demand supply gap in India, estimated in the current fiscal year, is sought to be alleviated by the foreign assets it was looking to buy.
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