Indian company investments in overseas coal mines

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Proposed coal plants Existing coal plants Ultra Mega Power Projects India's coal rush - December 2012 update Coal terminals Power companies Mining companies Indian company investments in overseas coal mines State-by-state coal profiles Opposition to coal in India
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Bangladesh and coal Clean Development Mechanism Global use and production of coal International Information on Coal Private equity financing World Bank and coal

Indian company investments in overseas coal mines include investments in Australia and Mozambique.

Investments in Australian coal mines and export infrastructure

In August 2010 Adani Mining, a subsidiary of Adani Group bought Linc Energy's Galilee coal tenement for $A500 million in cash plus a $2 per tonne royalty (indexed to the Consumer Price Index) for the first twenty years of coal production. According to Linc the Galilee tenement an indicated resource of 500 million tonnes and a further 7.3 billion tonnes as an inferred resources. The company claims that the "tenement is capable of producing up to 60 million tonnes of coal per year once fully operational."^[1]

In March 2011 Lanco Infratech Ltd’s bought the Griffin Coal Mining Co. Pty Ltd’s coal mines in Western Australia for A$750 million. The report stated that "Lanco plans to boost almost four-fold to over 15 million tonnes per annum, in addition to adding rail linkages, and expanding facilities at Bunbury port." The coal, aside from that produced domestically, would be exported to feed Lanco's proposed major increase in coal-fired power plants it owns and operates in India.^[2]

In May 2011 another Adani Group subsidiary paid $1.829 billion for the 99-year lease of the Abbot Point Coal Terminal in North Queensland. Mundra Port Pty Ltd, an Australian subsidiary of Mundra Port and Special Economic Zone Ltd, which in turn is a subsidiary of the Adani Group, had won the tender bid for the lease over the X50 terminal - which has the capacity for 50 million tonnes of coal a year.^[3]

In mid-June 2011 it was reported that an agreement had been reached for GVK Power and Infrastructure to purchase the Alpha and Kevin's Corner projects for $2.4 billion. "The individuals have signed, but the companies haven’t. It will take around a month for the complete paperwork to be completed. A formal announcement is expected shortly after that,” an anonymous GVK executive told the Wall Street Journal. It was reported that GVK would pay $1.25 billion at the time the agreement was formally signed off on with a further two equal instalments. There was no mention of Hancock retaining a share in either project.^[4]

Essar Energy states that it plans that coal for stages 1 & 2 of its own 3,000MW Salaya power plant in Gujarat, India be sourced from the company's "captive coal mines in Indonesia and Mozambique." Essar's only coal project in Mozambique is the Cambulatsitsi mine."`^[5]

In March 2007 Tata Power purchased a 30% stake in two coal mines owned by Bumi Resources --PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia (Arutmin). The deal was for approximately US$1.3 billion of which $1.1 billion was the base price. Announcing the deal, Bumi stated that Tata Power had entered into a "long term" coal off-take agreement with KPC "for the supply of approximately 10 million tonnes per annum at index linked prices for its power plant at Trombay in India as well as for future power projects, including the recently won Ultra Mega Power Project of 4,000MW at Mundra in India."^[6]

In November 2012 Tata Power announced that it had bought a 26% stake in PT Baramulti Suksessarana Tbk ("BSSR") in Indonesia. In a media release Tata stated that "PT Antang Gunung Meratus ("AGM"), a 100% subsidiary of the BSSR, and BSSR together own approximately 1 billion tonnes of coal resources in South and East Kalimantan." The company stated that "we recognize fuel security is key to support Tata Power's growth agenda. ... This acquisition would aim to support our power generation projects in select geographies, to be developed over next few years." The company stated that as part of the purchase the company can "purchase about 10 million tonnes of coal per annum."^[7]

Prasenjit Bhattacharya, "India’s Foreign Mine Hunt Not Going Well", Wall Street Journal, May 14, 2012.