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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 $8bn. Several other good-sized companies are expected to become involved in M&A including Consol Energy, Alpha Natural Resources and Arch Coal.
China’s lack of oil and gas reserves makes it difficult for the country to move away from coal, though the country has begun to address this over-reliance through imports and acquisitions of other resources. However, with newly installed coal-fired power plants now coming on line, it seems that China will remain heavily dependent on coal production and imports for the foreseeable future, and this will continue to drive overseas acquisitions of mining firms and coal assets.
Source: Financier World Wide
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Tuesday, 21 December 10
CIL TOLD TO SCOUT MINES ABROAD TO BRIDGE COAL DEFICIT - ECONOMIC TIMES
Economic Times reported that, The government asked state-owned CIL to look for acquiring assets abroad to meet the domestic shortfall of coal.
&q ...
Tuesday, 21 December 10
SHIPPING INDUSTRY RECOVERING, BUT STILL HAMPERED BY OVERSUPPLY OF VESSELS AND DEPRESSED FREIGHT RATES - UNCTAD / HELLENIC SHIPPING
International seaborne trade contracted by 4.5 per cent in 2009, reports UNCTAD´s Review of Maritime Transport 2010 . That decline put seaborn ...
Sunday, 19 December 10
SPOT SUPRAMAX VESSELS WERE FIXED AROUND US$ 13,000 PER DAY FOR TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The freight market continued to be soft with the BDI down by 96 points and closed at 1,999 points, touching below 2,000 points on Fri ...
Friday, 17 December 10
THE PANAMAX MARKET HAS EXPERIENCED A SOFTER TENDENCY THIS WEEK - FEARNBULK
Handy
Monotonous Atlantic markets with little fresh enquiry in Black Sea/Med/Continent. Large Supras are achieving usd 21/22k for TA rounds - 2/3 ...
Friday, 17 December 10
NALCO SHORTLISTS COAL FIRMS FOR INDONESIA PROJECT - BUSINESS-STANDARD
Business-Standard reported that, State-owned NALCO today said it has shortlisted two firms for supply of coal for its Rs 18,000-crore (US$ 3,953,003 ...
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- Star Paper Mills Limited - India
- Ministry of Finance - Indonesia
- Dalmia Cement Bharat India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate Of Revenue Intelligence - India
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Rio Tinto Coal - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kohat Cement Company Ltd. - Pakistan
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Indo Tambangraya Megah - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Straits Asia Resources Limited - Singapore
- Riau Bara Harum - Indonesia
- ICICI Bank Limited - India
- Siam City Cement - Thailand
- Commonwealth Bank - Australia
- Australian Coal Association
- Vedanta Resources Plc - India
- Vijayanagar Sugar Pvt Ltd - India
- Wilmar Investment Holdings
- Intertek Mineral Services - Indonesia
- The State Trading Corporation of India Ltd
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- European Bulk Services B.V. - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- CNBM International Corporation - China
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- Africa Commodities Group - South Africa
- Semirara Mining and Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Jorong Barutama Greston.PT - Indonesia
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- Grasim Industreis Ltd - India
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Deloitte Consulting - India
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- Indonesian Coal Mining Association
- Goldman Sachs - Singapore
- Indika Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Bharathi Cement Corporation - India
- Larsen & Toubro Limited - India
- Kobexindo Tractors - Indoneisa
- Simpson Spence & Young - Indonesia
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- White Energy Company Limited
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Kalimantan Lumbung Energi - Indonesia
- Latin American Coal - Colombia
- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- TNB Fuel Sdn Bhd - Malaysia
- Cement Manufacturers Association - India
- Indogreen Group - Indonesia
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Coal and Oil Company - UAE
- Coalindo Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Planning Commission, India
- Anglo American - United Kingdom
- Mercator Lines Limited - India
- Oldendorff Carriers - Singapore
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Holcim Trading Pte Ltd - Singapore
- New Zealand Coal & Carbon
- Pendopo Energi Batubara - Indonesia
- Ministry of Mines - Canada
- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Marubeni Corporation - India
- Aboitiz Power Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Miang Besar Coal Terminal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Antam Resourcindo - Indonesia
- Bukit Makmur.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Baramulti Group, Indonesia
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- IHS Mccloskey Coal Group - USA
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- Energy Development Corp, Philippines
- Mercuria Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sojitz Corporation - Japan
- South Luzon Thermal Energy Corporation
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Java Power - Indonesia
- Posco Energy - South Korea
- MS Steel International - UAE
- Asmin Koalindo Tuhup - Indonesia
- Thiess Contractors Indonesia
- Jaiprakash Power Ventures ltd
- Uttam Galva Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Interocean Group of Companies - India
- Merrill Lynch Commodities Europe
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- OPG Power Generation Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Kumho Petrochemical, South Korea
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- SMC Global Power, Philippines
- Petron Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Ministry of Transport, Egypt
- SN Aboitiz Power Inc, Philippines
- Borneo Indobara - Indonesia
- Manunggal Multi Energi - Indonesia
- Bhoruka Overseas - Indonesia
- Singapore Mercantile Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Independent Power Producers Association of India
- Toyota Tsusho Corporation, Japan
- Thai Mozambique Logistica
- Sarangani Energy Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Global Coal Blending Company Limited - Australia
- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- Indian Oil Corporation Limited
- Metalloyd Limited - United Kingdom
- Central Electricity Authority - India
- Xindia Steels Limited - India
- Sree Jayajothi Cements Limited - India
- London Commodity Brokers - England
- Maheswari Brothers Coal Limited - India
- Trasteel International SA, Italy
- Jindal Steel & Power Ltd - India
- Timah Investasi Mineral - Indoneisa
- Chamber of Mines of South Africa
- GVK Power & Infra Limited - India
- Medco Energi Mining Internasional
- Mintek Dendrill Indonesia
- The University of Queensland
- Karbindo Abesyapradhi - Indoneisa
- PNOC Exploration Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Sakthi Sugars Limited - India
- Ceylon Electricity Board - Sri Lanka
- PowerSource Philippines DevCo
- India Bulls Power Limited - India
- Georgia Ports Authority, United States
- Formosa Plastics Group - Taiwan
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Sical Logistics Limited - India
- Parliament of New Zealand
- AsiaOL BioFuels Corp., Philippines
- Electricity Generating Authority of Thailand
- Ambuja Cements Ltd - India
- VISA Power Limited - India
- Minerals Council of Australia
- Kepco SPC Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
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