By IANS,
New Delhi : State-run Coal India should actively pursue acquisition of assets abroad, its former chairman P.S. Bhattacharya said here Wednesday.
Speaking to IANS on the sidelines of the “6th Indian Coal Markets Conference” organised by SAIL and Tata Steel promoted eCommerce company, mjunction, Bhattacharya said it was currently an opportune time for Coal India Ltd (CIL) to explore assets in Australia.
CIL, which accounts for 80 percent of domestic production, is unable to satisfy the growing demand for coal in India, resulting in the need for more imports.
“In order to fill the gap in the current year’s coal production for energy needs our import requirement is to the tune of 80-85 million tonnes (mt) of coal,” said Bhattacharya.
Australia is the world’s largest net exporter of thermal coal and Bhattacharya said the current drop in world prices of the resource makes it an attractive prospect for acquiring mining assets.
“Falling coal prices has touched off a spate of asset sales as tough times spread from Australia to Indonesia and could boost deal activity in what has been a lean year in the mining sector,” he said.
“Australian companies, like mining giant BHP Billiton to smaller iron ore producers, are all in lock-down mode. They have shelved projects and cut output at high-cost mines to weather the downturn in iron ore and coal prices, and are considering asset sales.”
China’s coal output in the first eight months of 2012 has fallen 7.9 percentage points year-on-year as per China National Coal Association (CNCA), which attributed it to a slowing domestic economy.
“China will not remain a net importer of coal after some time and the availability of imported coal for India will improve,” said the former CIL chairman.
Indian companies have recently started venturing into thermal coal in Australia Infrastructure major GVK paid $1.26 billion last year to acquire 79 percent stake in the Alpha Coal and Alpha West projects and a 100 percent stake in the Kevin’s Corner project in Queensland from Hancock Prospecting Pty Ltd.
Gujarat-based Adani Enterprises plans to start digging its $10 billion Carmichael coal mine in the Galilee basin in Queensland in mid-2013.