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Monday, 27 April 09
JSW ENERGY SET TO SNAP UP AFRICAN COAL MINE FOR $70 MN - ECONOMIC TIMES


Sajjan Jindal-led JSW Energy is close to acquiring a sub-Saharan African thermal coal mine, which has reserves of more than 200 million   tonnes, to minimise dependence on other overseas companies, said a person with direct knowledge of the development.

Although the person did not reveal the deal size, an expert tracking the sector said it could be anywhere between $70-100 million (Rs 350-500 crore) depending on the quality of coal and how far the mine is from the port. Thermal coal is a key input in power generation.

The acquisition, if successful, would be funded through a mix of internal accruals and debt, the person added. Coal from the mine would be shipped to India for captive use in the company’s three upcoming power plants. JSW Energy, part of the JSW Group, has interests in power generation, transmission, distribution and trading.

The JSW Energy official spokesman declined to comment on the proposed deal. Currently, the company has access to limited thermal coal reserves in India and is largely dependant on imports. Besides making full-fledged acquisitions, the firm is also in talks with the local African government for jointly developing thermal coal mines.

According to a Delhi-based independent steel analyst, the procedure to access a coal mine in India is arduous and raises environmental issues. So, domestic power firms are constantly looking for mineral resources overseas.

Thermal coal is most well-found resource in the world and is available in abundance in Africa and Indonesia.  JSW Energy is in the process of installing three power plants, one each in Karnataka (600 mw), Rajasthan (1,080 mw) and Maharashtra (1,200 mw). The company has already commissioned 300 mw in Karnataka.

Source: http://economictimes.indiatimes.com/Metals--Mining/JSW-Energy-set-to-snap-up-African-coal-mine-for-70-mn/articleshow/4452637.cms



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