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Tuesday, 21 December 10
CHINA COAL CAP TO BOOST GLOBAL M&A - FINANCIER WORLD WIDE
 Financier World Wide reported that, Chinese state-run media has reported that the Central Government intends to cap domestic coal production for fear of exhausting reserves and failing to meet the needs of the fast expanding economy. At the same time, the National Energy Administration director, Zhang Guobao, has encouraged Chinese mining enterprises to pursue mergers and acquisitions at home and abroad in order to consolidate and modernise the disjointed mining industry and to increase coal imports. The news comes at a time when the global mining sector is witness to record annual M&A transactions. According to Dealogic, over $47.1bn has changed hands in 2010, through 968 deals. China was the target of a record $11.6bn of these deals.
Imports and exports
China’s love affair with coal began amidst the industrialisation of the 1950s, and the country has depended heavily on the fossil fuel ever since. Ninety-seven percent of China’s coal is consumed in power generation, industry, coking, and residential use and heating.
Of these, power supply needs dominate. According to the US Geological Survey (USGS), two-thirds of Chinese electricity generation is from coal-fired plants and power generation accounts for half of China’s coal use.
The pace of Chinese industrial growth saw the country move from being a net exporter of 1.8 million tonnes in 2008, to a net importer of 103 million tonnes in 2009. It is the second largest user of coal next to the US, accounting for 41 percent of the world’s total consumption, and is by far the world’s largest producer of the fuel. Despite this, China’s domestic mining industry is challenged by lack of centralisation, inefficiency and overburdened transport links. Frequent industrial accidents and environmental issues are also major problems.
Domestic and outbound deals
To modernise its mining industry the Chinese government aims to shut down a large proportion of its 11,000 small coal mines while encouraging state owned and private coal mine enterprises to initiate mergers and acquisitions.
Yanzhou Coal Mining Co. recently revealed plans to buy a 51 percent stake in the Inner Mongolia-based Haosheng Coal Mining Ltd. for $980m, and Aluminum Corporation of China will invest $80.5m to establish Shanxi Xiuxin Gugou Coal (Group), merging the assets of five coal companies. The newly established group will have coking coal reserves of 300 million tons which are expected to last up to 75 years.
The government also aims to secure imports through a program of cross-border M&A. In the three years to September 2010, Chinese companies spent $20.96bn on overseas coal industry acquisitions, and activity has continued since the government’s announcement. Australia has been a particularly prized target for Chinese firms of late.
Yanzhou bought Australia’s Felix Resources Ltd. for $2.9bn in August 2009 and has actively been scanning the market for additional acquisitions, particularly coking and thermal coal operations. In November 2010 China Coal Geology Engineering Corp and Wanbei Coal-Electricity Group partnered to explore and develop coal resources in Queensland. They expect to uncover 10 billion tonnes of reserves. November also saw Australia’s Caledon Resources agree to be bought by the Chinese state-owned investment group Guangdong Rising Assets Management Co for £252m.
Global interest
Companies around the world have caught wind of China’s resource fears, and are scrambling to meet the demand. On 16 November, Nat Rothchild’s Vallar paid $3bn for 25 percent of Indonesian coal producer PT Bumi Resources and 75 percent of PT Berau Coal Energy. Just days later, the US coal miner Walter Energy bid $3.2bn for Canada’s Western Coal, with the intention of supplying the Chinese market.
Plenty of others are cashing in too. Caterpillar has spent $8.6bn buying US-based Bucyrus, a manufacturer of excavators used in opencast coal mines. The firm has said the coal industry is one of the principal growth markets that they are now targeting.
Australia has remained a prime target for foreign companies seeking to benefit from growing prices and sales to Asia. 2010 saw $6.7bn of coal acquisitions in the country, compared to $5.9bn for the whole of 2009.
The US is also becoming a major playing field for coal industry M&A deals, due in part to the relatively low price of its thermal coal. Privately held, Alabama-based Drummond and Co. is taking bids for its mines in North Columbia, expecting to fetch up to $8bn. Several other good-sized companies are expected to become involved in M&A including Consol Energy, Alpha Natural Resources and Arch Coal.
China’s lack of oil and gas reserves makes it difficult for the country to move away from coal, though the country has begun to address this over-reliance through imports and acquisitions of other resources. However, with newly installed coal-fired power plants now coming on line, it seems that China will remain heavily dependent on coal production and imports for the foreseeable future, and this will continue to drive overseas acquisitions of mining firms and coal assets.
Source: Financier World Wide
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Saturday, 15 January 11
SUPRAMAX VESSELS FIXED AROUND $ 8K FOR TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The BDI continues to drop and has touched below 1,500 points with the cape index severely affected with the index touching 1,595 poin ...
Saturday, 15 January 11
MAKE SACRIFICES TO SAVE PLN, INDONESIA GOVT BEGS MINERS - THE JAKARTA GLOBE
The Jakarta Globe reported that, Darwin Zahedi Saleh, Indonesia's minister of energy and mineral resources, on Friday appealed to local coal compan ...
Saturday, 15 January 11
RISING PRICES, GOVERNMENT DECREE LEAVE PLN AT LOGGERHEADS WITH COAL FIRMS - THE JAKARTA GLOBE
The Jakarta Globe reported that, As coal prices continue to increase, state utility Perusahaan Listrik Negara faces problems in securing enough coal ...
Thursday, 13 January 11
SURGING COAL PRICES UNDERMINE PLN'S EFFICIENCY PROGRAM - THE JAKARTA POST
The Jakarta Post reported that, The soaring global coal prices are undermining state electricity company PT PLN's pledge to improve its operational ...
Thursday, 13 January 11
SPML INFRA TO DOUBLE INDONESIA COAL MINE OUTPUT IN TWO YEARS - DNA INDIA
DNA India reported that, Kolkata-based infrastructure company SPML Infra, formerly Subhash Projects & Marketing Ltd, will in two years nearly do ...
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- Sakthi Sugars Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Grasim Industreis Ltd - India
- Intertek Mineral Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Trasteel International SA, Italy
- The University of Queensland
- Krishnapatnam Port Company Ltd. - India
- Electricity Generating Authority of Thailand
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Global Business Power Corporation, Philippines
- McConnell Dowell - Australia
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Renaissance Capital - South Africa
- Mjunction Services Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Malabar Cements Ltd - India
- New Zealand Coal & Carbon
- Kobexindo Tractors - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- PTC India Limited - India
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Interocean Group of Companies - India
- Xindia Steels Limited - India
- San Jose City I Power Corp, Philippines
- TeaM Sual Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- Kideco Jaya Agung - Indonesia
- Kaltim Prima Coal - Indonesia
- ASAPP Information Group - India
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Maheswari Brothers Coal Limited - India
- Dalmia Cement Bharat India
- European Bulk Services B.V. - Netherlands
- Mintek Dendrill Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Tata Chemicals Ltd - India
- Antam Resourcindo - Indonesia
- Indika Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Latin American Coal - Colombia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Petron Corporation, Philippines
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- AsiaOL BioFuels Corp., Philippines
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Indian Energy Exchange, India
- Chamber of Mines of South Africa
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Savvy Resources Ltd - HongKong
- Parliament of New Zealand
- Jindal Steel & Power Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement PLC, Thailand
- VISA Power Limited - India
- Ministry of Transport, Egypt
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- SMC Global Power, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Star Paper Mills Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Bayan Resources Tbk. - Indonesia
- Deloitte Consulting - India
- Madhucon Powers Ltd - India
- Wilmar Investment Holdings
- Posco Energy - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Vizag Seaport Private Limited - India
- Coal and Oil Company - UAE
- Eastern Energy - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining Corp, Philippines
- Sojitz Corporation - Japan
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- Mercuria Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Borneo Indobara - Indonesia
- India Bulls Power Limited - India
- Siam City Cement - Thailand
- Gujarat Sidhee Cement - India
- TNB Fuel Sdn Bhd - Malaysia
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Uttam Galva Steels Limited - India
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Kumho Petrochemical, South Korea
- CIMB Investment Bank - Malaysia
- Karaikal Port Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Medco Energi Mining Internasional
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- Bhatia International Limited - India
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Salva Resources Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Central Electricity Authority - India
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- Edison Trading Spa - Italy
- Petrochimia International Co. Ltd.- Taiwan
- Therma Luzon, Inc, Philippines
- Formosa Plastics Group - Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Orica Australia Pty. Ltd.
- GN Power Mariveles Coal Plant, Philippines
- Simpson Spence & Young - Indonesia
- Toyota Tsusho Corporation, Japan
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Rio Tinto Coal - Australia
- Larsen & Toubro Limited - India
- Marubeni Corporation - India
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- Makarim & Taira - Indonesia
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Africa Commodities Group - South Africa
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Economic Council, Georgia
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Australian Coal Association
- Sree Jayajothi Cements Limited - India
- Ministry of Mines - Canada
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Indonesian Coal Mining Association
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- Aboitiz Power Corporation - Philippines
- Videocon Industries ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- MS Steel International - UAE
- The State Trading Corporation of India Ltd
- Oldendorff Carriers - Singapore
- Carbofer General Trading SA - India
- Agrawal Coal Company - India
- Indo Tambangraya Megah - Indonesia
- Attock Cement Pakistan Limited
- Globalindo Alam Lestari - Indonesia
- SMG Consultants - Indonesia
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- Eastern Coal Council - USA
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- Meralco Power Generation, Philippines
- Bhushan Steel Limited - India
- Sarangani Energy Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Bhoruka Overseas - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
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