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Thursday, 16 September 10
RPG GROUP BUYS 10% IN AUSSIE COAL FIRM RESOURCE GENERATION


Dealcurry reported that, India's RPG Group's Integrated Coal Mining Limited (ICML) has acquired 10% stake (18,268,053 shares) in Resource Generation Limited (RG), an Australian coal mining company for about A$ 0.575 per share, aggregating to A$10.5 Mn (Rs.45 crore).

An affiliate company of power producer CESC Ltd, ICML has inked an offshore coal procurement contract with RG to purchase 37 million tonne (MT) coal over 20 years from RGL’s Boikarabelo mine in South Africa. ICML will purchase a mln MT of thermal coal per annum for three years and two MTPA for a further 17 years.

The coal will feed future greenfield projects in Haldia in Bengal and Chandrapura in Maharashtra of RPG flagship CESC. CESC owns around 26% in ICML, while for RG, this is a major step in its plan to establish its Boikarabelo mine as a significant supplier of coal for both export and South Africa’s domestic markets.

CESC is a power utility company, with an installed capacity of 1,225 MW in Kolkata and Howrah and this acquisition will enable CESC to increase its capacity to 5,745 MW.

RG is dual-listed company on the Australian and Johannesburg stock exchanges, with coal mining assets in Tasmania in Australia and in South Africa. It also has uranium exploration projects in central-west Africa’s Cameroon.

The coal purchases will begin when the Boikarabelo mine commences production, scheduled for early 2013. The price will be agreed annually, based on the international benchmark price at the time.

The mine is in the Waterberg region of South Africa, one of the country’s largest remaining coal deposits. It is estimated to have 603 MT of reserves, about 40% of South Africa’s untapped coal mines of around 1500 MT.

The international coal sector has seen active participation from Indian steel,coke manufacturers and power generation companies.

This year in April, JSW Energy Ltd acquired 49.8% stake in Royal Bafokeng Capital (Proprietary) Ltd that owns shares in South African Coal Mining Holdings Ltd from Strider Holdings (Proprietary) Ltd. Essar group bought US based Trinity Coal for $600mn and an Indonesian mine $200mn.

Tata Steel has also decided to acquire 80% in the direct shipping ore project of New Millennium Capital Corp, Canada (NML).
Source:
Dealcurry



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