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Friday, 26 September 14
INDIA SUPREME COURT RULING TO HIT STEEL, UTILITY EARNINGS, SAYS FITCH
 COALspot.com: The 24 September Supreme Court of India (SCI) decision to cancel almost every coal block allocation since 1993 will have a negative financial impact on a number of Indian power and steel companies, says Fitch Ratings.
The decision is broadly credit negative for these sectors, but should have no impact on the ratings of any Fitch-rated steel or power sector corporates.
According to Fitch, the decision to cancel 214 of 218 coal licences follows a ruling in August in which the SCI declared the licence allocation process as arbitrary and illegal. The cancelled licences include 46 producing or near-production blocks, and are owned largely by power and steel sector companies. The producing mines will be allowed to continue operations until March 2015, at which point they will be handed back to state firm, Coal India Limited, until they are sold as part of a new auction process.
Companies with cancelled licences will not receive any compensation on account of development expenditure incurred to date, meaning these will have to be written off. They can bid for the same coal blocks when they come back on the market, while it will be an open bidding process. Furthermore, they will now have to pay for externally sourced coal, resulting in higher operating costs. The SCI's decision also levies a fine of INR295/tonne on coal produced to date from the mines affected, which could amount to INR73bn (USD1.2bn), Fitch says in its latest research report.
The negative financial impact will vary significantly depending on the company. Current credit profiles are likely to remain intact for Fitch-rated steel and power companies. The ruling has no immediate direct impact on Tata Steel Limited (BB+/Stable) and Steel Authority of India Limited (SAIL, BBB-/Stable). All but one of their operational coal mines were allocated before 1993, which are exempt from the decision. In addition, SAIL's one operational mine which was allocated after 1993 was one of the four licences upheld by the SCI as valid. The cancellation of non-operational coal licenses will not hurt credit profiles, as these have not been factored into Fitch's long-term financial projections for these companies.
Power Company NTPC Limited (BBB-/Stable) could be more vulnerable to the decision, though Fitch maintains that the broader impact will still be relatively small. Pakhri Barwadih, an NTPC mine nearing production, has been exempt from the cancellation. The status of the other nine of NTPC's 10 coal blocks is uncertain, as it is not very clear if they are also exempt - owing to the fact that NTPC is a state-owned entity. The company had expected that its captive mines would be able to serve 4.3% of its coal requirements in FY15 - rising further to 15% by FY17.
The potential long-term effects of the decision on the wider power and steel sectors will depend largely on how quickly the government proceeds with re-auctioning the licences. This could lead to more efficient development of these coal blocks in the long term should the new process go quickly. Uncertainty regarding the original allocation process had previously contributed in part to the underdevelopment and utilisation of these blocks.
However, it is important to highlight that a new and transparent auction process is just one factor needed to boost coal production in India. Other key challenges remain, including tough environmental clearances and regulatory approvals.
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Wednesday, 21 June 23
CHINA'S MAY COAL IMPORTS FROM AUSTRALIA RECOVER TO PRE-BAN LEVELS - REUTERS
Australian coal sales to China increased in May, as trade resumed between them even as overall coal demand weakened against an uncertain macroecono ...
Monday, 19 June 23
DROUGHT-DEPLETED HYDROPOWER DRIVES CHINA TO TURN TO COAL - REUTERS
China has leant hard on coal-fired power plants as well as wind and solar generators to make up for a shortfall in hydroelectric generation as a re ...
Monday, 19 June 23
CHINA COAL OUTPUT UP 4.2 PCT IN MAY - XINHUA
China’s raw coal output posted steady growth in May, official data showed.
The country produced 390 million tonnes of raw coal ...
Wednesday, 24 May 23
AMMONIA-FUELLED BULK CARRIERS WITHIN FIVE YEARS - BALTIC EXCHANGE
Within five years, ships powered by clean ammonia could be a feature on the iron ore trade routes between West Australia and East Asia.
A study ...
Tuesday, 23 May 23
CHINA'S APRIL COAL OUTPUT LEAPS 11% ON YEAR, BUT DEMAND DOWNTURN LOOMS - REUTERS
China’s daily coal output in April jumped 11% from the same month a year earlier, boosted by Beijing’s order to increase supply to ensu ...
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- Asmin Koalindo Tuhup - Indonesia
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- Kapuas Tunggal Persada - Indonesia
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
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- Neyveli Lignite Corporation Ltd, - India
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- Metalloyd Limited - United Kingdom
- Wood Mackenzie - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining Corp, Philippines
- The State Trading Corporation of India Ltd
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- Meralco Power Generation, Philippines
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- SMC Global Power, Philippines
- Tamil Nadu electricity Board
- Coalindo Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Kobexindo Tractors - Indoneisa
- PowerSource Philippines DevCo
- McConnell Dowell - Australia
- Larsen & Toubro Limited - India
- MS Steel International - UAE
- Bukit Baiduri Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Rio Tinto Coal - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Anglo American - United Kingdom
- Coal and Oil Company - UAE
- Africa Commodities Group - South Africa
- PTC India Limited - India
- SMG Consultants - Indonesia
- AsiaOL BioFuels Corp., Philippines
- The University of Queensland
- Oldendorff Carriers - Singapore
- Chettinad Cement Corporation Ltd - India
- Merrill Lynch Commodities Europe
- Bharathi Cement Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Carbofer General Trading SA - India
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- ASAPP Information Group - India
- Holcim Trading Pte Ltd - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Posco Energy - South Korea
- Siam City Cement PLC, Thailand
- Videocon Industries ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Cement Manufacturers Association - India
- CNBM International Corporation - China
- Thiess Contractors Indonesia
- Altura Mining Limited, Indonesia
- Gujarat Sidhee Cement - India
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- Jaiprakash Power Ventures ltd
- Banpu Public Company Limited - Thailand
- Riau Bara Harum - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- Star Paper Mills Limited - India
- Mintek Dendrill Indonesia
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- Meenaskhi Energy Private Limited - India
- Minerals Council of Australia
- Toyota Tsusho Corporation, Japan
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Coal Council - USA
- Semirara Mining and Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Singapore Mercantile Exchange
- India Bulls Power Limited - India
- South Luzon Thermal Energy Corporation
- Parliament of New Zealand
- Maharashtra Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Port Waratah Coal Services - Australia
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Kumho Petrochemical, South Korea
- ICICI Bank Limited - India
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Timah Investasi Mineral - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Ministry of Mines - Canada
- Borneo Indobara - Indonesia
- Siam City Cement - Thailand
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- White Energy Company Limited
- Ind-Barath Power Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Bhatia International Limited - India
- Sarangani Energy Corporation, Philippines
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- Aboitiz Power Corporation - Philippines
- Commonwealth Bank - Australia
- Eastern Energy - Thailand
- Energy Link Ltd, New Zealand
- Aditya Birla Group - India
- Energy Development Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- Ceylon Electricity Board - Sri Lanka
- Jorong Barutama Greston.PT - Indonesia
- Orica Australia Pty. Ltd.
- Savvy Resources Ltd - HongKong
- Parry Sugars Refinery, India
- Orica Mining Services - Indonesia
- Mjunction Services Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Electricity Authority, New Zealand
- Vizag Seaport Private Limited - India
- VISA Power Limited - India
- Australian Coal Association
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- Simpson Spence & Young - Indonesia
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Globalindo Alam Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Georgia Ports Authority, United States
- Gujarat Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Indian Oil Corporation Limited
- Alfred C Toepfer International GmbH - Germany
- Economic Council, Georgia
- Malabar Cements Ltd - India
- Latin American Coal - Colombia
- Deloitte Consulting - India
- Antam Resourcindo - Indonesia
- New Zealand Coal & Carbon
- Xindia Steels Limited - India
- Sical Logistics Limited - India
- London Commodity Brokers - England
- Marubeni Corporation - India
- Bhushan Steel Limited - India
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- SN Aboitiz Power Inc, Philippines
- Chamber of Mines of South Africa
- Intertek Mineral Services - Indonesia
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- CIMB Investment Bank - Malaysia
- Edison Trading Spa - Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cigading International Bulk Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Leighton Contractors Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Independent Power Producers Association of India
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- San Jose City I Power Corp, Philippines
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