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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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Thursday, 03 May 12
DRY BULK MARKET REMAINS INACTIVE, POSTING MILD DECREASE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept retreating this week, although at a very low pace, on the back of a lull in demand. The industry's benchmark, th ...
Thursday, 03 May 12
MINERS DEMAND LEGAL CERTAINTY ON PRE-BAN INTERIM POLICY - THE JAKARTA POST
The Jakarta Post reported that, Mining companies represented by the Indonesian Mining Association (IMA) welcomed the government’s plan to impo ...
Thursday, 03 May 12
HANDY EAST COAST INDIA - CHINA AROUND USD 7000 - FEARNLEYS AS
Handy - Stable demand in the Atlantic offered good rates for the tonnage.
USG/Cont was worth USD 17500 and more. Baltic and Black Sea appeared to ...
Wednesday, 02 May 12
CHINA BLACKOUTS HIGHLIGHT PRICING POLICY WEAKNESS - FITCH
Fitch reported that, the likelihood of further electricity blackouts in China this summer underlines Fitch's view of the basic problem f ...
Tuesday, 01 May 12
VIETNAM FEARS IT MAY NOT SEEK COAL SUPPLIES - TBKTSG / VIETNAMNET BRIDGE
TBKTSG / VietNamNet Bridge reported that, with five coal-run thermopower plants under construction, PetroVietnam alone would need 18 million tons of ...
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- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Banpu Public Company Limited - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Samtan Co., Ltd - South Korea
- Wilmar Investment Holdings
- Parry Sugars Refinery, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mjunction Services Limited - India
- CNBM International Corporation - China
- Bukit Baiduri Energy - Indonesia
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Latin American Coal - Colombia
- ICICI Bank Limited - India
- Chamber of Mines of South Africa
- SMG Consultants - Indonesia
- Tamil Nadu electricity Board
- Directorate General of MIneral and Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- AsiaOL BioFuels Corp., Philippines
- Oldendorff Carriers - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Maharashtra Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Maheswari Brothers Coal Limited - India
- Salva Resources Pvt Ltd - India
- Eastern Coal Council - USA
- SMC Global Power, Philippines
- Central Electricity Authority - India
- Indika Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Toyota Tsusho Corporation, Japan
- Ceylon Electricity Board - Sri Lanka
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Malabar Cements Ltd - India
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- Kideco Jaya Agung - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Uttam Galva Steels Limited - India
- Aditya Birla Group - India
- Central Java Power - Indonesia
- Singapore Mercantile Exchange
- Port Waratah Coal Services - Australia
- Savvy Resources Ltd - HongKong
- Trasteel International SA, Italy
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Economic Council, Georgia
- Planning Commission, India
- PTC India Limited - India
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Australian Coal Association
- Commonwealth Bank - Australia
- MS Steel International - UAE
- Eastern Energy - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Madhucon Powers Ltd - India
- Ministry of Transport, Egypt
- Edison Trading Spa - Italy
- Deloitte Consulting - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Siam City Cement - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Videocon Industries ltd - India
- Global Coal Blending Company Limited - Australia
- Bhoruka Overseas - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Grasim Industreis Ltd - India
- Meenaskhi Energy Private Limited - India
- Petron Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Therma Luzon, Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- VISA Power Limited - India
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- Power Finance Corporation Ltd., India
- OPG Power Generation Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Timah Investasi Mineral - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Indonesian Coal Mining Association
- Larsen & Toubro Limited - India
- Orica Mining Services - Indonesia
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- IHS Mccloskey Coal Group - USA
- Electricity Authority, New Zealand
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Bhatia International Limited - India
- Binh Thuan Hamico - Vietnam
- Marubeni Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Rio Tinto Coal - Australia
- Semirara Mining and Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- Heidelberg Cement - Germany
- Cement Manufacturers Association - India
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Vijayanagar Sugar Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Rashtriya Ispat Nigam Limited - India
- GVK Power & Infra Limited - India
- Sical Logistics Limited - India
- Antam Resourcindo - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Coastal Gujarat Power Limited - India
- Parliament of New Zealand
- Tata Chemicals Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mintek Dendrill Indonesia
- Renaissance Capital - South Africa
- Georgia Ports Authority, United States
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Posco Energy - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- Mercuria Energy - Indonesia
- White Energy Company Limited
- Neyveli Lignite Corporation Ltd, - India
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Merrill Lynch Commodities Europe
- Independent Power Producers Association of India
- The University of Queensland
- Thiess Contractors Indonesia
- Price Waterhouse Coopers - Russia
- Sarangani Energy Corporation, Philippines
- Vedanta Resources Plc - India
- Kartika Selabumi Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- Aboitiz Power Corporation - Philippines
- Bulk Trading Sa - Switzerland
- Iligan Light & Power Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Electricity Generating Authority of Thailand
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Ministry of Finance - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Bharathi Cement Corporation - India
- Makarim & Taira - Indonesia
- Kapuas Tunggal Persada - Indonesia
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- TeaM Sual Corporation - Philippines
- McConnell Dowell - Australia
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- Medco Energi Mining Internasional
- Minerals Council of Australia
- Bangladesh Power Developement Board
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- Kumho Petrochemical, South Korea
- Energy Development Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Xindia Steels Limited - India
- International Coal Ventures Pvt Ltd - India
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