$100 million for expansion into Kalimantan mining: AKR

Sat, 08October, 2011

The Jakarta Globe, one of the leading English news paper in Indonesia reported that, AKR Corporindo, a fuel and chemical distributor, has set aside $100 million to finance its expansion plans, including a push to acquire a coal-mining plant in Kalimantan, a top executive said.

The company’s president director, Haryanto Adikusumo, said on Wednesday that AKR would also spend some of the funds that it raised from a sale in a plantation company to build roads and coal terminals in Kalimantan.

“This diversification aims to meet growing demand in Indonesia, India and China,’’ Haryanto said.

Jakarta-based AKR is also building a coal terminal at Kalimantan’s Timbau Bay to ferry coal to overseas markets like China, the president director added.

AKR’s coal sales are forecast to increase to 1.2 million tons in 2012 from around 200,000 tons this year. AKR already has a coal-mining plant in the area that started commercial operations in the middle of this year.

Haryanto said that AKR targets revenue to increase to Rp 18 trillion ($2 billion) this year from Rp 12 trillion in 2010. Its first-half revenue rose 74 percent to Rp 9.06 trillion from a year earlier. In the same period, its net income more than doubled to Rp 266 billion from Rp 94 billion.

AKR’s coal expansion is in line with moves by other Indonesian companies, such as vehicle distributor Astra International, that have announced massive expansion plans.

The acquisition of coal mining companies is a frequent choice, to benefit from the rising price of coal in the global market. Astra, the largest automotive retailer in Indonesia, has allocated $1.5 billion for investment, which includes the purchase of a coal miner next year.

AKR raised Rp 2.2 trillion from the sale of its stake in Sorini Agro Asia to agribusiness giant Cargill this year. Sorini is one of the world’s leading producers and suppliers of sorbitol and operates seven manufacturing facilities that are located in East Java and Lampung.

Shares of AKR rose 6.45 percent to Rp 62,475 on the Indonesia Stock Exchange on Thursday. The shares have risen 43 percent this year.

sourced The Jakarta Globe, by Faisal Maliki Baskoro via coalspot

Anglo gets full ownership of Peace River Coal

Thu,Oct06, 2011

ANGLO American said yesterday it had acquired full ownership of its Peace River Coal partnership in British Columbia by purchasing the 25,17% in the metallurgical coal venture that it did not already own for $166m.

Anglo American has purchased the 12,18% stake held by Northern Energy & Mining for $76m, and the 12,99% held by Hillsborough Resources for $81m plus $9m for Hillsborough’s royalty rights.

Anglo American will be progressing a feasibility study to increase production at Peace River to 3,5-million tons a year by 2015 from 1-million tons, it said yesterday.

Reuters has reported that Anglo American might be among the bidders for Australian coal miner New Hope, which put itself up for auction yesterday.

New Hope said it had received several informal approaches and it would invite selected parties to bid, starting a process that could test Australia’s openness to foreign mine owners. New Hope would not name the interested parties.

Analysts said firms in rapidly growing China and India were probably among them, although industry officials in India said New Hope might be too expensive for an Indian company to acquire.

A takeover of New Hope, which has its own port, would be the latest in a string of deals in Australia’s coal sector, reflecting demand to feed Asia’s strong growth.

Chairman Robert Millner hinted that New Hope could be a reluctant target, but the company was obliged to explore any deal that would give shareholders best value. The company has A$1,5bn ($1,4bn) on its balance sheet and does not need a partner to fund expansion.

"We have not been out shopping the company. We are going down this path purely because we have had these approaches from numerous third parties," Mr Millner told Reuters, adding they were "preliminary and incomplete proposals".

New Hope’s open-cut New Acland mine produces thermal coal used in power plants. New Hope sells about 65% of its coal overseas and the rest to the domestic market.

A potential buyer could be China’s Yanzhou Coal Mining, which earlier this year unsuccessfully bid for Australia’s Whitehaven Coal.

Murray Bailey, the MD of Yanzhou’s Australian operations, Yancoal, is a former chief operations officer at New Hope.

London-based bankers said that Anglo-Swiss miner Xstrata, its peer Anglo American and commodity trader and miner Glencore might also be interested in New Hope.

"This is a region of the world where Xstrata is a major player and the product is important to them," one of the bankers said, although he added that he was not aware that any of those companies had appointed banks to work on a potential bid.

Indian firms such as GVK Power & Infrastructure and Adani have also been active in Australia.

Australia has scrutinised foreign miners’ bids very closely in recent years, particularly those from state- linked Asian companies, and has at times rejected them or imposed strict conditions.

New Hope is 59,7% owned by diversified investor Washington H Soul Pattinson, where Mr Millner is also the chairman.

New Hope had been talking to the interested parties for four to five months and would look at setting up a data room after indicative proposals came in within the next two months, he said.

"As there has been more and more interest, we decided this was the best and fairest way to go down this process," Mr Millner said. (sourced Bloomberg, Reuters)

Monnet Ispat acquires coal mine in Indonesia

Mon March 20, 2011, 0:05 IST
By Shubhashish

Mumbai: Monnet Ispat and Energy has bought a 100-million tonne coal mine in Indonesia, sources say. The announcement is likely to be made on Monday.

An official close to the deal told Business Standard, “The company has been in serious talks for the past 5 months to buy a 100-million tonne thermal coal mine in Indonesia. The acquisition is now complete and the announcement will happen on Monday.”

The official said the company has been looking at 4-5 coal mines in Indonesia and zeroed on this particular mine after careful inspection and due diligence. Company sources did not comment for the story.

Monnet Group's power projects fall under its subsidiary, Monnet Power Company. The subsidiary is currently setting up a 1050-Mw power plant in Angul, and has captive coal mines to feed the plant. The plant is expected to be operational by the third quarter of 2012. The company is also setting up additional 2,000-Mw power projects by June, 2014. Of the 2,000 Mw, two super critical power projects with the rated capacity of 2 x 660 Mw, equal to 1320 Mw, would come up and would be fed with imported coal.

Another source said the company has firmed up plans to increase its power generation capacity and to complement the plan, has been on the look-out for coal mines. The company has two power plants in Chhattisgarh — in Raigarh and Raipur, each with a combined capacity of 250 Mw. Monnet plans to ramp up the capacity to 500 Mw in two years and would need more coal to run the plant. The official said, “Currently, our coal mine in Chhatisgarh is producing 1 million tonne of coal and there is a plan to increase it up to 1.5 million tonne. Our total coal requirement for the Chhattisgarh power plants is currently 2.5-3 million tonne and the shortfall is met from the open market.” He said after the capacity is increased to 500 Mw, the company would need 5 million tonne of coal per year. (By Business Standard)