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Friday, 18 January 13
NEWLEAD HOLDINGS LTD. TO ACQUIRE TWO COAL PROPERTIES WITH ESTIMATED COAL RESERVES OF 18.6 MMT & 143.1 MMT
 NewLead Holdings Ltd. Announces Signing Agreement to Acquire Properties with Estimated Coal Reserves of 18.6 Million Tons; Signing Agreement to Acquire Properties with Estimated Coal Reserves of 143.1 Million Tons and Securing 3-year Coal Supply Contracts Expected to Generate $873.5 million of Revenue
NewLead Holdings Ltd., is an international, vertically integrated shipping and commodity company that manages product tankers and dry bulk vessels, yesterday announced that the Company has entered into an agreement to acquire title and excavation rights in properties containing 18.6 million tons of estimated coal reserves for $11.0 million.
According to a press release posted on Company’s website, NewLead also entered into an agreement to acquire ownership and leasehold interests in properties containing approximately 143.1 million tons of coal for $55.0 million. Michael Zolotas, President and Chief Executive Officer of NewLead, stated, "We have expanded our recently launched commodities business with the agreement to acquire an estimated 18.6 million tons of coal reserves. We are in the process of acquiring additional coal properties with reserves estimated at approximately 143.1 million tons. Once we have acquired all of the assets, our coal reserves will consist primarily of sub bituminous B coal, which is 13,500 BTU with low sulfur. We will also have 'Blue Gem' and 'Rich Mountain' seams of coal, highly sought after in the international market. We believe that our international shipping expertise will allow us to exploit the demand for these coal reserves."
Michael Zolotas continued, "In entering the mining business, we undertook to secure supply contracts for the coal reserves. Consequently, we entered into two agreements to supply coal to third parties. These agreements are expected to generate $873.5 million of revenue over a three-year period. Based on our projections of operating costs, we believe that these sales will have healthy margins and will generate significant cash flow with which to fund continued growth. We intend to supplement the supply agreements by allowing contract miners to mine and pay us a royalty for coal removed."
Coal and Natural Gas Reserve Acquisitions
As of December 28, 2012, NewLead entered into an agreement to acquire title and mineral excavation rights to 5,000 acres of land in Kentucky. The coal reserves in these properties are estimated to be approximately 18.6 million tons. The transaction is subject to execution and delivery of certain definitive agreements and other closing conditions, but is currently expected to close by January 29, 2013. There can be no assurance that the transaction will be consummated. The consideration of $11.0 million was paid in the form of notes maturing on January 29, 2013. The notes do not accrue interest, but remain subject to a guaranty by the initial purchaser and are secured by a mortgage lien and a security interest in the assets being purchased.
NewLead has also entered into an agreement to acquire ownership and leasehold interests in 18,335 acres in Tennessee containing coal and natural gas and other natural resources. The agreement contemplates that the Company will acquire rights, title, permits and leases to coal mines with total reserves estimated at 143.1 million tons. The transaction is subject to execution and delivery of certain definitive agreements and other closing conditions, but is currently expected to close in February 2013. There can be no assurance that the transaction will be consummated. The agreement contemplates that consideration of $55.0 million shall be payable in cash in two installments; $30.0 million at closing and the remaining $25.0 million on the first anniversary of the closing.
The estimated reserves stated above are as determined by independent appraisals. The methodology used by the independent appraisers was not compliant with the methodology required by the Securities and Exchange Commission ("SEC") in reserve reports and, accordingly, should not be relied upon. Such reserve information is only provided to give the best currently available information. NewLead is undertaking to obtain reserve reports that comply with SEC methodology. Such reports may differ materially from the information provided herein.
The properties in Tennessee and Kentucky also include natural gas wells and projects relating to extraction of timber, sand, gravel, fly ash and dimension stone. Third parties are currently extracting these commodities on the properties and paying royalties.
Coal Supply Contracts
NewLead signed two coal supply contracts with creditworthy counterparties for the sale of coal to such parties. Annual revenue from these two contracts is expected to be $184.7 million in the first year, $318.4 million in the second year and $370.4 million for the third and final year.
The first contract provides for the sale of 70,000 tons of coal per month for the first 12 months (840,000 tons annually), increasing to 140,000 tons per month for the second year (1.68 million tons annually) and 210,000 tons per month for the third year (2.52 million tons annually). All tonnage is subject to a variation of 5%. The price was established based on the prevailing market price for coal at the time the contract was entered into.
The second contract provides for the sale of 130,000 metric tons per month for the first 12 months (1.56 million metric tons annually), increasing to 210,000 metric tons per month for the second and third years (2.52 million metric tons annually). All tonnage is subject to a variation of 5%. The price was established based on the prevailing market price for coal at the time the contract was entered into.
NewLead intends to source the coal to meet such contracts from the estimated reserves discussed above, but to the extent it is unable to do so, it will be required to seek to source the coal from other suppliers at the prevailing prices.
Management Company
NewLead also entered into an agreement to acquire a local coal mining management company in exchange for compensation, paid in the form $3.0 million in common shares of NewLead and a warrant for $6.4 million in common shares of NewLead. Such acquisition is subject to a number of terms and conditions and there is no assurance it will be consummated. The management company shall be responsible for managing the daily operations of the coal mines and the excavation of the coal from the properties.
For more details please visit www.newleadholdings.com.
Source: NewLead Holdings
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Sunday, 22 December 19
NMDC DIVERSIFIES INTO COAL MINING - THE HINDU
Iron ore mining major NMDC has been allocated two coal blocks in Jharkhand for commercial mining by the Union Ministry of Coal.
Both ...
Sunday, 22 December 19
TRADING PLACES FOR 2020 - BALTIC EXCHANGE
In the sea of 2020 predictions, Saxo Bank’s Outrageous Predictions sail their own very unique course. For nearly 20 years the Danish investme ...
Saturday, 21 December 19
SUPRAMAX: A 63,000 DWT VESSEL, OPEN CIGADING, FIXED A TRIP VIA INDONESIA, REDELIVERY WEST COAST INDIA, AT $8,500 - BALTIC BRIEFING
Capesize
The Capesize market this past week has been attempting to recalibrate itself in consideration of weakening freight levels and increasi ...
Saturday, 21 December 19
SHIPPING'S SUPPLY AND DEMAND TRENDING OFF BALANCE - BIMCO
One of the most worrying trends that has developed recently – which will affect shipping demand in the years to come – is the falling t ...
Friday, 20 December 19
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- The State Trading Corporation of India Ltd
- ICICI Bank Limited - India
- Manunggal Multi Energi - Indonesia
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Semirara Mining and Power Corporation, Philippines
- Star Paper Mills Limited - India
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Heidelberg Cement - Germany
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- SMC Global Power, Philippines
- Indo Tambangraya Megah - Indonesia
- Intertek Mineral Services - Indonesia
- Renaissance Capital - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- SMG Consultants - Indonesia
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Trasteel International SA, Italy
- Bukit Asam (Persero) Tbk - Indonesia
- Economic Council, Georgia
- Barasentosa Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- India Bulls Power Limited - India
- MS Steel International - UAE
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- Oldendorff Carriers - Singapore
- OPG Power Generation Pvt Ltd - India
- Ministry of Finance - Indonesia
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Minerals Council of Australia
- LBH Netherlands Bv - Netherlands
- Eastern Coal Council - USA
- Cement Manufacturers Association - India
- Wilmar Investment Holdings
- Binh Thuan Hamico - Vietnam
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- Malabar Cements Ltd - India
- Altura Mining Limited, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Mjunction Services Limited - India
- Coalindo Energy - Indonesia
- Meralco Power Generation, Philippines
- Electricity Authority, New Zealand
- Price Waterhouse Coopers - Russia
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Lanco Infratech Ltd - India
- Africa Commodities Group - South Africa
- Thai Mozambique Logistica
- Metalloyd Limited - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Miang Besar Coal Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
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- Bharathi Cement Corporation - India
- Indogreen Group - Indonesia
- Rashtriya Ispat Nigam Limited - India
- SN Aboitiz Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Aboitiz Power Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Ambuja Cements Ltd - India
- Videocon Industries ltd - India
- Globalindo Alam Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- Gujarat Mineral Development Corp Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Larsen & Toubro Limited - India
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- Tamil Nadu electricity Board
- Edison Trading Spa - Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Anglo American - United Kingdom
- Agrawal Coal Company - India
- PTC India Limited - India
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Ministry of Mines - Canada
- San Jose City I Power Corp, Philippines
- Siam City Cement PLC, Thailand
- Coastal Gujarat Power Limited - India
- Bulk Trading Sa - Switzerland
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jindal Steel & Power Ltd - India
- Indika Energy - Indonesia
- Carbofer General Trading SA - India
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- Bhoruka Overseas - Indonesia
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Jorong Barutama Greston.PT - Indonesia
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Directorate General of MIneral and Coal - Indonesia
- Merrill Lynch Commodities Europe
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- Wood Mackenzie - Singapore
- Bangladesh Power Developement Board
- Eastern Energy - Thailand
- Goldman Sachs - Singapore
- IHS Mccloskey Coal Group - USA
- VISA Power Limited - India
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Borneo Indobara - Indonesia
- McConnell Dowell - Australia
- Georgia Ports Authority, United States
- Grasim Industreis Ltd - India
- Parliament of New Zealand
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- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Central Java Power - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Latin American Coal - Colombia
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- Bahari Cakrawala Sebuku - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- ASAPP Information Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- Vedanta Resources Plc - India
- Orica Mining Services - Indonesia
- Petron Corporation, Philippines
- Sical Logistics Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Medco Energi Mining Internasional
- Chamber of Mines of South Africa
- Mercuria Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Marubeni Corporation - India
- Mercator Lines Limited - India
- London Commodity Brokers - England
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Makarim & Taira - Indonesia
- Bukit Makmur.PT - Indonesia
- Simpson Spence & Young - Indonesia
- PowerSource Philippines DevCo
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- Indian Oil Corporation Limited
- Global Coal Blending Company Limited - Australia
- Bhatia International Limited - India
- International Coal Ventures Pvt Ltd - India
- Indian Energy Exchange, India
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- Australian Coal Association
- Electricity Generating Authority of Thailand
- Riau Bara Harum - Indonesia
- Central Electricity Authority - India
- Toyota Tsusho Corporation, Japan
- CNBM International Corporation - China
- Bukit Baiduri Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The Treasury - Australian Government
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Bhushan Steel Limited - India
- Mintek Dendrill Indonesia
- Kartika Selabumi Mining - Indonesia
- Commonwealth Bank - Australia
- GAC Shipping (India) Pvt Ltd
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
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