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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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Monday, 10 January 11
COAL MONGOLIA IS INVITING YOU TO THE INTERNATIONAL COAL SECTOR INVESTORS CONFERENCE
COALspot.com - (Press Release) - The Coal Mongolian Conference will take place at Chinggis Hotel, in Ulaanbaatar on 24-25, Feb 2011. The coal bonanz ...
Monday, 10 January 11
DEWA SEEKS ADVICE ON COAL POWER PROJECT -THE NATIONAL
The Dubai utility company gets nine bids from international groups for consultancy role.
The National reported that, Dubai's utility company wil ...
Saturday, 08 January 11
COAL PRICE WILL RISE IN SHORT-TERM DUE TO AUSTRALIA FLOODS - ALBUQUERQUE EXPRESS
Albuquerque Express reported that, Queensland’s mining minister, Stephen Robertson, has warned that the Australian state’s coal mines wi ...
Saturday, 08 January 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 8.69 PERCENT IN JANUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the January 2011 Indonesian Coal Reference Price for thermal ...
Saturday, 08 January 11
SUPRAMAX VESSELS WERE FIXED AT AROUND $ 9000 PD FOR A TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The holiday season affect combined with severe flooding in Queensland ports continues to keep the market and pressure. “Suprama ...
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- Tamil Nadu electricity Board
- Grasim Industreis Ltd - India
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- VISA Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Bangladesh Power Developement Board
- PNOC Exploration Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Toyota Tsusho Corporation, Japan
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Holcim Trading Pte Ltd - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Orica Australia Pty. Ltd.
- Directorate Of Revenue Intelligence - India
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Kepco SPC Power Corporation, Philippines
- Aditya Birla Group - India
- Ceylon Electricity Board - Sri Lanka
- Heidelberg Cement - Germany
- SMG Consultants - Indonesia
- Romanian Commodities Exchange
- Indogreen Group - Indonesia
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- The University of Queensland
- Marubeni Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Bhatia International Limited - India
- Commonwealth Bank - Australia
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- Price Waterhouse Coopers - Russia
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CIMB Investment Bank - Malaysia
- ASAPP Information Group - India
- Bayan Resources Tbk. - Indonesia
- Kaltim Prima Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Metalloyd Limited - United Kingdom
- Binh Thuan Hamico - Vietnam
- Sical Logistics Limited - India
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Siam City Cement PLC, Thailand
- Xindia Steels Limited - India
- Bulk Trading Sa - Switzerland
- Mercator Lines Limited - India
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Wood Mackenzie - Singapore
- Ministry of Finance - Indonesia
- Baramulti Group, Indonesia
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- SN Aboitiz Power Inc, Philippines
- Edison Trading Spa - Italy
- Kobexindo Tractors - Indoneisa
- White Energy Company Limited
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- Power Finance Corporation Ltd., India
- Manunggal Multi Energi - Indonesia
- Central Electricity Authority - India
- Banpu Public Company Limited - Thailand
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Madhucon Powers Ltd - India
- SMC Global Power, Philippines
- Agrawal Coal Company - India
- London Commodity Brokers - England
- Siam City Cement - Thailand
- Aboitiz Power Corporation - Philippines
- India Bulls Power Limited - India
- Carbofer General Trading SA - India
- Ind-Barath Power Infra Limited - India
- Sree Jayajothi Cements Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Iligan Light & Power Inc, Philippines
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Formosa Plastics Group - Taiwan
- Intertek Mineral Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mercuria Energy - Indonesia
- Chamber of Mines of South Africa
- GVK Power & Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- Leighton Contractors Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Orica Mining Services - Indonesia
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Globalindo Alam Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- Coal and Oil Company - UAE
- Malabar Cements Ltd - India
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- Karaikal Port Pvt Ltd - India
- Ministry of Mines - Canada
- Anglo American - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- IEA Clean Coal Centre - UK
- International Coal Ventures Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Bharathi Cement Corporation - India
- Rashtriya Ispat Nigam Limited - India
- Australian Commodity Traders Exchange
- Parliament of New Zealand
- Maharashtra Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Baiduri Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Cement Manufacturers Association - India
- Indian Energy Exchange, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Sarangani Energy Corporation, Philippines
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- Electricity Generating Authority of Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Ambuja Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- Riau Bara Harum - Indonesia
- CNBM International Corporation - China
- Neyveli Lignite Corporation Ltd, - India
- Global Coal Blending Company Limited - Australia
- Indika Energy - Indonesia
- Australian Coal Association
- Sindya Power Generating Company Private Ltd
- Miang Besar Coal Terminal - Indonesia
- Rio Tinto Coal - Australia
- Global Business Power Corporation, Philippines
- PTC India Limited - India
- Videocon Industries ltd - India
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Salva Resources Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Asmin Koalindo Tuhup - Indonesia
- Makarim & Taira - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Wilmar Investment Holdings
- Borneo Indobara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- McConnell Dowell - Australia
- European Bulk Services B.V. - Netherlands
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Thai Mozambique Logistica
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Latin American Coal - Colombia
- Pipit Mutiara Jaya. PT, Indonesia
- Samtan Co., Ltd - South Korea
- Ministry of Transport, Egypt
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
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