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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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Saturday, 07 December 19
CHINA'S BENCHMARK POWER COAL PRICE DROPS SLIGHTLY - XINHUA
China’s benchmark power coal price dropped slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge ...
Saturday, 07 December 19
SOUTH AFRICAN COAL PRICE SURGE, WHILE OTHERS LANGUISH, IS TROUBLING - REUTERS
Coal prices around the world are gently sliding as demand from top importers such as China, India and even Europe remains subdued amid a so far mil ...
Saturday, 07 December 19
SUPRAMAX: OVERALL, THE BALTIC SUPRAMAX INDEX REMAINED IN POSITIVE MODE, DESPITE SOME AREAS LACKING FRESH ACTIVITY - BALTIC BRIEFING
Capesize
This week the Capesize market maintained healthy earnings, as an end of year surge took the Capesize 5TC back up to $25,202 by mid-wee ...
Friday, 06 December 19
INDONESIA COAL BENCHMARK PRICE FOR DECEMBER INCREASES BY US 3 CENTS MOM
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised up the benchmark price of Indonesian thermal co ...
Thursday, 05 December 19
IMO 2020 IS ABOUT TO GET REAL - GAVIN THOMPSON
As I write this edition of the APAC Energy Buzz from my desk in Singapore I can see ships. Lots of ships. No surprise given that Singapore is among ...
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- The University of Queensland
- Deloitte Consulting - India
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- Timah Investasi Mineral - Indoneisa
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- Indogreen Group - Indonesia
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- Bank of Tokyo Mitsubishi UFJ Ltd
- PowerSource Philippines DevCo
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Riau Bara Harum - Indonesia
- Kumho Petrochemical, South Korea
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- Energy Development Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
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- The Treasury - Australian Government
- Indian Oil Corporation Limited
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- Australian Commodity Traders Exchange
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- Truba Alam Manunggal Engineering.Tbk - Indonesia
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- Energy Link Ltd, New Zealand
- Singapore Mercantile Exchange
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- MS Steel International - UAE
- The State Trading Corporation of India Ltd
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- Jindal Steel & Power Ltd - India
- CIMB Investment Bank - Malaysia
- Sical Logistics Limited - India
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- Banpu Public Company Limited - Thailand
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- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- SN Aboitiz Power Inc, Philippines
- Mintek Dendrill Indonesia
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- New Zealand Coal & Carbon
- Pipit Mutiara Jaya. PT, Indonesia
- Parliament of New Zealand
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- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Coal and Oil Company - UAE
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- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- ICICI Bank Limited - India
- Petron Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Commonwealth Bank - Australia
- White Energy Company Limited
- Central Electricity Authority - India
- Indika Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- ASAPP Information Group - India
- Wilmar Investment Holdings
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
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- Xindia Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Sidhee Cement - India
- Eastern Coal Council - USA
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Economic Council, Georgia
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- CNBM International Corporation - China
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- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Independent Power Producers Association of India
- Bukit Makmur.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Minerals Council of Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Planning Commission, India
- Ambuja Cements Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Tata Chemicals Ltd - India
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Australian Coal Association
- Ministry of Transport, Egypt
- Global Coal Blending Company Limited - Australia
- Meenaskhi Energy Private Limited - India
- Makarim & Taira - Indonesia
- Vedanta Resources Plc - India
- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Uttam Galva Steels Limited - India
- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Antam Resourcindo - Indonesia
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- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- PTC India Limited - India
- Agrawal Coal Company - India
- Marubeni Corporation - India
- Aditya Birla Group - India
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Sakthi Sugars Limited - India
- Sinarmas Energy and Mining - Indonesia
- Simpson Spence & Young - Indonesia
- Interocean Group of Companies - India
- Ministry of Mines - Canada
- Indo Tambangraya Megah - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Power Finance Corporation Ltd., India
- Metalloyd Limited - United Kingdom
- Barasentosa Lestari - Indonesia
- Ministry of Finance - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sindya Power Generating Company Private Ltd
- Heidelberg Cement - Germany
- LBH Netherlands Bv - Netherlands
- Karaikal Port Pvt Ltd - India
- SMG Consultants - Indonesia
- Wood Mackenzie - Singapore
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Renaissance Capital - South Africa
- Sree Jayajothi Cements Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Intertek Mineral Services - Indonesia
- Indonesian Coal Mining Association
- Savvy Resources Ltd - HongKong
- Gujarat Mineral Development Corp Ltd - India
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- GVK Power & Infra Limited - India
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- Samtan Co., Ltd - South Korea
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- PNOC Exploration Corporation - Philippines
- Siam City Cement - Thailand
- Anglo American - United Kingdom
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- Neyveli Lignite Corporation Ltd, - India
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Global Business Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Electricity Authority, New Zealand
- Malabar Cements Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Star Paper Mills Limited - India
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