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Friday, 08 June 12
NO IMMEDIATE IMPACT ON ADARO'S RATING FROM BEP TRANSACTION - FITCH RATINGS
 Fitch Ratings has said that PT Adaro Indonesia's (Adaro, 'BB+'/ Stable) ratings are not immediately affected by its parent PT Adaro Energy Tbk's (Adaro Energy) planned investment in greenfield coal miner PT Bhakti Energi Persada (BEP).
Adaro Energy recently signed an agreement for the right to acquire up to 51% of BEP over three years for up to USD500m through a convertible loan or to issue a pre-specified number of shares of Adaro Energy to the shareholders of BEP (participating in this agreement) in exchange for 79.8% of BEP. Adaro Energy currently owns 10.22% of BEP.
BEP has seven coal concessions, all IUPs (Izin Usaha Pertambangans - mining business licences), with estimated Australasian Joint Ore Reserves Committee (JORC)-compliant coal resources of 9.53 billion tonnes. Fitch expects that a large part of the investment required before bringing these resources to production will relate to the coal hauling road connecting the mines to barging and shipping points. Coal resources of BEP are of low energy content (3,379kcal on a gross as received basis) and as such will trade at a substantial discount to benchmark thermal coal prices. However, the favourable geology of BEP mines will allow the extraction of coal at an extremely low strip ratio (i.e., units of overburden to be removed on per unit of coal extracted) over the average life of a mine of below 0.5x as estimated by Adaro Energy, supporting the economic viability of these operations. The materially shorter supply chain of BEP's mines at 130km (versus 320km for Adaro's existing mines) would provide further support.
However, BEP coal mines have substantially lower cash margins than Adaro Energy's currently main cash generating mine, Tutupan, and are more susceptible to low coal prices. There is also uncertainty relating to coal mining regulations in Indonesia at present, such as restrictions on coal exports and a resource export tax. Any unfavourable regulatory developments can affect the commerciality of BEP's operations. However, Adaro Energy's options to invest in rather than an outright purchase of BEP resources provide a meaningful level of flexibility and safety. Fitch believes that any investments in the first half of the three-year option period will not be significant and can be funded from Adaro Energy's projected internal cash generation.
If successfully executed, BEP can over time contribute to the increasing diversity of Adaro Energy's mining operations. The limited diversity of Adaro Energy's existing mine sites is one of the factors currently constraining its ratings.
The ratings of Adaro are based on the credit profile of Adaro Energy given their strong rating linkages as per Fitch's parent-subsidiary linkage methodology. At end-March 2012 Adaro Energy's funds from operations (FFO)-adjusted gross leverage was 2.4x and FFO interest coverage 7.0x.
Negative rating action may result from FFO gross leverage rising above 2.75x or FFO interest coverage falling below 5x for two consecutive years. Other negative rating guidelines are material deviation from its policy of maintaining strong liquidity; adverse regulatory developments that will significantly impair Adaro Energy's financial profile; further substantial investments that weaken Adaro's financial or operating risk profile and a sustained weakening of coal prices.
Source: Fitch (Hong Kong) Limited
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Wednesday, 22 March 23
MARKET INSIGHT - INTERMODAL
The crude tanker market continues to gather momentum as we head towards the end of 1Q2023, against a backdrop of strong U.S. exports paired with a ...
Wednesday, 22 March 23
WILL LOWER GAS PRICES SPARK SWITCHING IN EUROPE AND ASIA?
Record high prices devastated demand for gas and LNG across Asia and Europe last year. But with prices falling, companies are starting to re-evalua ...
Monday, 20 March 23
NTPC MULLS 5.4 MILLION TONNES COAL IMPORT IN FIRST HALF OF 2023-24: PTI
State-run power giant NTPC is planning to import around 5.4 million tonnes of coal to meet the supply shortage during the first half 2023-24 fiscal ...
Monday, 20 March 23
S. AFRICA’S EXXARO RESOURCES SAYS COAL PRICES COOLING OFF - REUTERS
South Africa’s Exxaro Resources on Thursday posted a 28% jump in 2022 profit after seeing average coal prices surge more than 150%, but warne ...
Saturday, 18 March 23
RUSSIAN LNG EXPORTS TO EUROPE REMAIN HIGH - VESSELS VALUE
Russian LNG exports to Europe remained at very high levels in February at 3.6 million CBM, following a 13 month high in January of 4.1 million CBM. ...
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- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Chettinad Cement Corporation Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Intertek Mineral Services - Indonesia
- Barasentosa Lestari - Indonesia
- Eastern Coal Council - USA
- International Coal Ventures Pvt Ltd - India
- Sical Logistics Limited - India
- Rashtriya Ispat Nigam Limited - India
- Heidelberg Cement - Germany
- Meralco Power Generation, Philippines
- Manunggal Multi Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Toyota Tsusho Corporation, Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jaiprakash Power Ventures ltd
- Petrochimia International Co. Ltd.- Taiwan
- Marubeni Corporation - India
- Australian Coal Association
- Savvy Resources Ltd - HongKong
- Aboitiz Power Corporation - Philippines
- Makarim & Taira - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Simpson Spence & Young - Indonesia
- Central Electricity Authority - India
- South Luzon Thermal Energy Corporation
- Global Business Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Samtan Co., Ltd - South Korea
- Maharashtra Electricity Regulatory Commission - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- PowerSource Philippines DevCo
- Cement Manufacturers Association - India
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- Coalindo Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Star Paper Mills Limited - India
- Singapore Mercantile Exchange
- CNBM International Corporation - China
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- The University of Queensland
- Mjunction Services Limited - India
- Sakthi Sugars Limited - India
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- Indian Oil Corporation Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Tamil Nadu electricity Board
- Iligan Light & Power Inc, Philippines
- Orica Mining Services - Indonesia
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Malabar Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Bhoruka Overseas - Indonesia
- Sarangani Energy Corporation, Philippines
- Vizag Seaport Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Attock Cement Pakistan Limited
- AsiaOL BioFuels Corp., Philippines
- ICICI Bank Limited - India
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- VISA Power Limited - India
- Petron Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- LBH Netherlands Bv - Netherlands
- Globalindo Alam Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
- Siam City Cement PLC, Thailand
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- Planning Commission, India
- Ministry of Mines - Canada
- Maheswari Brothers Coal Limited - India
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Goldman Sachs - Singapore
- Sojitz Corporation - Japan
- OPG Power Generation Pvt Ltd - India
- Indian Energy Exchange, India
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- Pipit Mutiara Jaya. PT, Indonesia
- Directorate Of Revenue Intelligence - India
- Thiess Contractors Indonesia
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- TeaM Sual Corporation - Philippines
- Tata Chemicals Ltd - India
- Videocon Industries ltd - India
- Bharathi Cement Corporation - India
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Parry Sugars Refinery, India
- Merrill Lynch Commodities Europe
- Kumho Petrochemical, South Korea
- Interocean Group of Companies - India
- Sinarmas Energy and Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Chamber of Mines of South Africa
- New Zealand Coal & Carbon
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- ASAPP Information Group - India
- Africa Commodities Group - South Africa
- Sree Jayajothi Cements Limited - India
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- MS Steel International - UAE
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- Mercator Lines Limited - India
- Australian Commodity Traders Exchange
- Indika Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Standard Chartered Bank - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Sindya Power Generating Company Private Ltd
- CIMB Investment Bank - Malaysia
- Bulk Trading Sa - Switzerland
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Coastal Gujarat Power Limited - India
- India Bulls Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Bayan Resources Tbk. - Indonesia
- Renaissance Capital - South Africa
- Madhucon Powers Ltd - India
- Pendopo Energi Batubara - Indonesia
- Minerals Council of Australia
- Aditya Birla Group - India
- Banpu Public Company Limited - Thailand
- Riau Bara Harum - Indonesia
- SN Aboitiz Power Inc, Philippines
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- GMR Energy Limited - India
- Borneo Indobara - Indonesia
- GVK Power & Infra Limited - India
- Thai Mozambique Logistica
- Ministry of Transport, Egypt
- Kaltim Prima Coal - Indonesia
- Anglo American - United Kingdom
- Uttam Galva Steels Limited - India
- Semirara Mining Corp, Philippines
- Orica Australia Pty. Ltd.
- Directorate General of MIneral and Coal - Indonesia
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- Kepco SPC Power Corporation, Philippines
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Economic Council, Georgia
- Latin American Coal - Colombia
- Port Waratah Coal Services - Australia
- Electricity Authority, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- Formosa Plastics Group - Taiwan
- Price Waterhouse Coopers - Russia
- Edison Trading Spa - Italy
- Lanco Infratech Ltd - India
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