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Tuesday, 21 December 10
CHINA COAL CAP TO BOOST GLOBAL M&A - FINANCIER WORLD WIDE
 Financier World Wide reported that, Chinese state-run media has reported that the Central Government intends to cap domestic coal production for fear of exhausting reserves and failing to meet the needs of the fast expanding economy. At the same time, the National Energy Administration director, Zhang Guobao, has encouraged Chinese mining enterprises to pursue mergers and acquisitions at home and abroad in order to consolidate and modernise the disjointed mining industry and to increase coal imports. The news comes at a time when the global mining sector is witness to record annual M&A transactions. According to Dealogic, over $47.1bn has changed hands in 2010, through 968 deals. China was the target of a record $11.6bn of these deals.
Imports and exports
China’s love affair with coal began amidst the industrialisation of the 1950s, and the country has depended heavily on the fossil fuel ever since. Ninety-seven percent of China’s coal is consumed in power generation, industry, coking, and residential use and heating.
Of these, power supply needs dominate. According to the US Geological Survey (USGS), two-thirds of Chinese electricity generation is from coal-fired plants and power generation accounts for half of China’s coal use.
The pace of Chinese industrial growth saw the country move from being a net exporter of 1.8 million tonnes in 2008, to a net importer of 103 million tonnes in 2009. It is the second largest user of coal next to the US, accounting for 41 percent of the world’s total consumption, and is by far the world’s largest producer of the fuel. Despite this, China’s domestic mining industry is challenged by lack of centralisation, inefficiency and overburdened transport links. Frequent industrial accidents and environmental issues are also major problems.
Domestic and outbound deals
To modernise its mining industry the Chinese government aims to shut down a large proportion of its 11,000 small coal mines while encouraging state owned and private coal mine enterprises to initiate mergers and acquisitions.
Yanzhou Coal Mining Co. recently revealed plans to buy a 51 percent stake in the Inner Mongolia-based Haosheng Coal Mining Ltd. for $980m, and Aluminum Corporation of China will invest $80.5m to establish Shanxi Xiuxin Gugou Coal (Group), merging the assets of five coal companies. The newly established group will have coking coal reserves of 300 million tons which are expected to last up to 75 years.
The government also aims to secure imports through a program of cross-border M&A. In the three years to September 2010, Chinese companies spent $20.96bn on overseas coal industry acquisitions, and activity has continued since the government’s announcement. Australia has been a particularly prized target for Chinese firms of late.
Yanzhou bought Australia’s Felix Resources Ltd. for $2.9bn in August 2009 and has actively been scanning the market for additional acquisitions, particularly coking and thermal coal operations. In November 2010 China Coal Geology Engineering Corp and Wanbei Coal-Electricity Group partnered to explore and develop coal resources in Queensland. They expect to uncover 10 billion tonnes of reserves. November also saw Australia’s Caledon Resources agree to be bought by the Chinese state-owned investment group Guangdong Rising Assets Management Co for £252m.
Global interest
Companies around the world have caught wind of China’s resource fears, and are scrambling to meet the demand. On 16 November, Nat Rothchild’s Vallar paid $3bn for 25 percent of Indonesian coal producer PT Bumi Resources and 75 percent of PT Berau Coal Energy. Just days later, the US coal miner Walter Energy bid $3.2bn for Canada’s Western Coal, with the intention of supplying the Chinese market.
Plenty of others are cashing in too. Caterpillar has spent $8.6bn buying US-based Bucyrus, a manufacturer of excavators used in opencast coal mines. The firm has said the coal industry is one of the principal growth markets that they are now targeting.
Australia has remained a prime target for foreign companies seeking to benefit from growing prices and sales to Asia. 2010 saw $6.7bn of coal acquisitions in the country, compared to $5.9bn for the whole of 2009.
The US is also becoming a major playing field for coal industry M&A deals, due in part to the relatively low price of its thermal coal. Privately held, Alabama-based Drummond and Co. is taking bids for its mines in North Columbia, expecting to fetch up to $8bn. Several other good-sized companies are expected to become involved in M&A including Consol Energy, Alpha Natural Resources and Arch Coal.
China’s lack of oil and gas reserves makes it difficult for the country to move away from coal, though the country has begun to address this over-reliance through imports and acquisitions of other resources. However, with newly installed coal-fired power plants now coming on line, it seems that China will remain heavily dependent on coal production and imports for the foreseeable future, and this will continue to drive overseas acquisitions of mining firms and coal assets.
Source: Financier World Wide
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Friday, 24 December 10
DRY BULK OWNERS COULD SOON RECONSIDER SCRAPPING OLDER VESSELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market close to its lowest levels in months and indeed close to 2010 lows, ship owners could be heading towards scrapyards in a bi ...
Thursday, 23 December 10
SOUTHGOBI RESOURCES CLOSES STRATEGIC INVESTMENT IN ASPIRE MINING LIMITED
Press Release – SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878), announced today that it has completed the private placement with Aspire Mining ...
Thursday, 23 December 10
CESC EYES COAL MINES IN INDONESIA, S AFRICA - TEHELKA
Company has already set a target of adding 6,000 MW power generation by the end of the 12th Plan in 2017
Tehelka reported that, CESC Ltd, the fla ...
Thursday, 23 December 10
SANTA CLAUSE DID NOT COME EARLY THIS YEAR - FEARNBULK
Handy
Not much fresh enquiry this week and quite dead in Bl.Sea/Med. Nevertheless ...
Thursday, 23 December 10
STERLITE ENERGY LIMITED TO BUY 0.6 MLN MT OF COAL FOR 2011
COALspot.com - Sterlite Energy Limited (SEL) is a part of Vedanta Resources plc , a London listed FTSE 100 diversified metals and mining major with ...
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- White Energy Company Limited
- Asmin Koalindo Tuhup - Indonesia
- Global Coal Blending Company Limited - Australia
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Metalloyd Limited - United Kingdom
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- Deloitte Consulting - India
- Holcim Trading Pte Ltd - Singapore
- Parry Sugars Refinery, India
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Indogreen Group - Indonesia
- Wood Mackenzie - Singapore
- Cigading International Bulk Terminal - Indonesia
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Renaissance Capital - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Krishnapatnam Port Company Ltd. - India
- Bhoruka Overseas - Indonesia
- Eastern Energy - Thailand
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Agrawal Coal Company - India
- Directorate Of Revenue Intelligence - India
- LBH Netherlands Bv - Netherlands
- Directorate General of MIneral and Coal - Indonesia
- Price Waterhouse Coopers - Russia
- Semirara Mining and Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Power Finance Corporation Ltd., India
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Singapore Mercantile Exchange
- Uttam Galva Steels Limited - India
- Siam City Cement - Thailand
- Ambuja Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Aditya Birla Group - India
- London Commodity Brokers - England
- San Jose City I Power Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Kumho Petrochemical, South Korea
- Bangladesh Power Developement Board
- Larsen & Toubro Limited - India
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Neyveli Lignite Corporation Ltd, - India
- Australian Coal Association
- Bukit Asam (Persero) Tbk - Indonesia
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Chettinad Cement Corporation Ltd - India
- Binh Thuan Hamico - Vietnam
- Sical Logistics Limited - India
- ASAPP Information Group - India
- Rashtriya Ispat Nigam Limited - India
- CNBM International Corporation - China
- Electricity Generating Authority of Thailand
- Kartika Selabumi Mining - Indonesia
- Orica Mining Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- Posco Energy - South Korea
- GMR Energy Limited - India
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Indian Oil Corporation Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Green Power PLC Corporation, Philippines
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- Ministry of Transport, Egypt
- The University of Queensland
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Planning Commission, India
- CIMB Investment Bank - Malaysia
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- Georgia Ports Authority, United States
- Marubeni Corporation - India
- The Treasury - Australian Government
- Iligan Light & Power Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Kapuas Tunggal Persada - Indonesia
- Karaikal Port Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- PetroVietnam Power Coal Import and Supply Company
- Thai Mozambique Logistica
- TeaM Sual Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Coalindo Energy - Indonesia
- Banpu Public Company Limited - Thailand
- PNOC Exploration Corporation - Philippines
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Electricity Authority, New Zealand
- Port Waratah Coal Services - Australia
- Latin American Coal - Colombia
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- Bukit Baiduri Energy - Indonesia
- Vizag Seaport Private Limited - India
- Central Java Power - Indonesia
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- Central Electricity Authority - India
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Bhushan Steel Limited - India
- Minerals Council of Australia
- Kaltim Prima Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Pendopo Energi Batubara - Indonesia
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Mjunction Services Limited - India
- Bhatia International Limited - India
- Mercator Lines Limited - India
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Attock Cement Pakistan Limited
- Ceylon Electricity Board - Sri Lanka
- Aboitiz Power Corporation - Philippines
- PowerSource Philippines DevCo
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- Mintek Dendrill Indonesia
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Altura Mining Limited, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Parliament of New Zealand
- OPG Power Generation Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Wilmar Investment Holdings
- Interocean Group of Companies - India
- Kobexindo Tractors - Indoneisa
- Eastern Coal Council - USA
- Sinarmas Energy and Mining - Indonesia
- Cement Manufacturers Association - India
- AsiaOL BioFuels Corp., Philippines
- New Zealand Coal & Carbon
- Bukit Makmur.PT - Indonesia
- Energy Development Corp, Philippines
- Chamber of Mines of South Africa
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Borneo Indobara - Indonesia
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Medco Energi Mining Internasional
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Anglo American - United Kingdom
- Salva Resources Pvt Ltd - India
- Independent Power Producers Association of India
- Goldman Sachs - Singapore
- Indonesian Coal Mining Association
- Romanian Commodities Exchange
- Kepco SPC Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Tamil Nadu electricity Board
- Coastal Gujarat Power Limited - India
- Leighton Contractors Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Economic Council, Georgia
- Simpson Spence & Young - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Energy Link Ltd, New Zealand
- Miang Besar Coal Terminal - Indonesia
- Videocon Industries ltd - India
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- Bulk Trading Sa - Switzerland
- Alfred C Toepfer International GmbH - Germany
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