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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, 27 December 10
HUNT FOR OVERSEAS COAL ASSETS TO INTENSIFY - FINANCIAL EXPRESS
Financial Express reported that, With the Indian economy back on the track after the slowdown, merger and acquisition (M&A) activities in the re ...
Monday, 27 December 10
RIO TINTO EYES AUSTRALIAN COAL MINER - RTE NEWS
Global resources giant Rio Tinto has made a $3.9 billion bid for Australian coal miner Riversdale.
RTE News reported that, Global resources giant ...
Sunday, 26 December 10
ANGLO SELLS AUSTRALIAN COAL ASSETS - BARCELONA NEWS
Barcelona News reported that, Anglo American has sold off undeveloped Australia coal assets for $577 million.
The global resources giant ha ...
Saturday, 25 December 10
FREIGHT MARKET - LOWEST FIXTURES REPORTED SINCE MID 2009 - CAPT. REDDY
COALspot.com - We wish you a Merry Christmas and a Happy New Year 2011.
The holiday season seems to have severely affected the fr ...
Friday, 24 December 10
CIL SHORTLISTS 21 FIRMS TO IMPORT 250 MT COAL - THE HINDU
The Hindu reported that, Coal India plans to import about 250 million tonnes (mt) over the next 10 years to meet the country's growing requirement. ...
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- GVK Power & Infra Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Directorate Of Revenue Intelligence - India
- Posco Energy - South Korea
- Central Java Power - Indonesia
- Aboitiz Power Corporation - Philippines
- Siam City Cement PLC, Thailand
- Alfred C Toepfer International GmbH - Germany
- Chamber of Mines of South Africa
- Agrawal Coal Company - India
- Orica Mining Services - Indonesia
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- SN Aboitiz Power Inc, Philippines
- Edison Trading Spa - Italy
- IEA Clean Coal Centre - UK
- Bhoruka Overseas - Indonesia
- Videocon Industries ltd - India
- Larsen & Toubro Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SMC Global Power, Philippines
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Grasim Industreis Ltd - India
- Intertek Mineral Services - Indonesia
- Kumho Petrochemical, South Korea
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Georgia Ports Authority, United States
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- Bharathi Cement Corporation - India
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Central Electricity Authority - India
- Straits Asia Resources Limited - Singapore
- Australian Coal Association
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- The State Trading Corporation of India Ltd
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- Binh Thuan Hamico - Vietnam
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- Uttam Galva Steels Limited - India
- Kartika Selabumi Mining - Indonesia
- Power Finance Corporation Ltd., India
- Star Paper Mills Limited - India
- Malabar Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- GAC Shipping (India) Pvt Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- Borneo Indobara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Madhucon Powers Ltd - India
- Minerals Council of Australia
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- India Bulls Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Standard Chartered Bank - UAE
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- South Luzon Thermal Energy Corporation
- Toyota Tsusho Corporation, Japan
- Global Business Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Jindal Steel & Power Ltd - India
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- Semirara Mining and Power Corporation, Philippines
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- Deloitte Consulting - India
- IHS Mccloskey Coal Group - USA
- Ministry of Finance - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Merrill Lynch Commodities Europe
- Coastal Gujarat Power Limited - India
- Iligan Light & Power Inc, Philippines
- ASAPP Information Group - India
- Petrochimia International Co. Ltd.- Taiwan
- McConnell Dowell - Australia
- The Treasury - Australian Government
- SMG Consultants - Indonesia
- Meenaskhi Energy Private Limited - India
- Tata Chemicals Ltd - India
- Kepco SPC Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Planning Commission, India
- Independent Power Producers Association of India
- Bukit Baiduri Energy - Indonesia
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Billiton Holdings Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Economic Council, Georgia
- Global Coal Blending Company Limited - Australia
- Interocean Group of Companies - India
- Directorate General of MIneral and Coal - Indonesia
- Goldman Sachs - Singapore
- Cigading International Bulk Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Indogreen Group - Indonesia
- Global Green Power PLC Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Antam Resourcindo - Indonesia
- Maheswari Brothers Coal Limited - India
- Barasentosa Lestari - Indonesia
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Sarangani Energy Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Metalloyd Limited - United Kingdom
- Ministry of Mines - Canada
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tamil Nadu electricity Board
- ICICI Bank Limited - India
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Baramulti Group, Indonesia
- Sojitz Corporation - Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bulk Trading Sa - Switzerland
- OPG Power Generation Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Meralco Power Generation, Philippines
- Singapore Mercantile Exchange
- Makarim & Taira - Indonesia
- Australian Commodity Traders Exchange
- Savvy Resources Ltd - HongKong
- LBH Netherlands Bv - Netherlands
- Mjunction Services Limited - India
- Ceylon Electricity Board - Sri Lanka
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Parliament of New Zealand
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Indian Oil Corporation Limited
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Wood Mackenzie - Singapore
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- Commonwealth Bank - Australia
- Indonesian Coal Mining Association
- Bhatia International Limited - India
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Orica Australia Pty. Ltd.
- MS Steel International - UAE
- Ambuja Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- Karaikal Port Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- London Commodity Brokers - England
- Mercator Lines Limited - India
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- Medco Energi Mining Internasional
- Therma Luzon, Inc, Philippines
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