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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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Tuesday, 17 September 19
THE DRY BULK FREIGHT MARKET IS ALREADY ON A DOWNWARD CORRECTION - ALLIED
Here we are again, just a breath before the final quarter of the year. Under typical circumstances and on the basis of what we have seen during the ...
Monday, 16 September 19
COLOMBIAN COAL PRODUCTION TO FALL 5% THIS YEAR, MINING GROUP SAYS - REUTERS
Colombia’s coal production will decline to around 80 million tonnes in 2019, nearly 5% below last year’s, because of low prices and dro ...
Monday, 16 September 19
THE COAL-D SHOULDER? - BALTIC EXCHANGE
Good fortune and the number 13 don’t usually go hand in hand, but when it comes to coal, 2013 actually seems to have been the commodity&rsquo ...
Monday, 16 September 19
SCRUBBERS AND FUEL PROFIT SHARE CLAUSES - CLYDE&CO
From 1 January 2020, Regulation 14 of MARPOL Annex VI provides that the sulphur content in fuel oil used on board ships shall be reduced from a max ...
Monday, 16 September 19
KOREA SOUTH-EAST POWER INVITES BIDS FOR MAX 1,290,000 METRIC TONS OF STEAMING COAL
COALspot.com: South Korea’s Korea East-West Power Co. Ltd has issued an international tender for total 1,290,000 Metric Tons steam coal.
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- The University of Queensland
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- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Pendopo Energi Batubara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Indonesian Coal Mining Association
- Aboitiz Power Corporation - Philippines
- Goldman Sachs - Singapore
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- VISA Power Limited - India
- Iligan Light & Power Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SMC Global Power, Philippines
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
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- Electricity Authority, New Zealand
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- Medco Energi Mining Internasional
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- OPG Power Generation Pvt Ltd - India
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- Romanian Commodities Exchange
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- Indian Oil Corporation Limited
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- SN Aboitiz Power Inc, Philippines
- CIMB Investment Bank - Malaysia
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- MS Steel International - UAE
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- Altura Mining Limited, Indonesia
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- Savvy Resources Ltd - HongKong
- IHS Mccloskey Coal Group - USA
- Tata Chemicals Ltd - India
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- Singapore Mercantile Exchange
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- Baramulti Group, Indonesia
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Intertek Mineral Services - Indonesia
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- Maharashtra Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cement Manufacturers Association - India
- PTC India Limited - India
- Port Waratah Coal Services - Australia
- Thai Mozambique Logistica
- Vedanta Resources Plc - India
- Independent Power Producers Association of India
- Kohat Cement Company Ltd. - Pakistan
- Metalloyd Limited - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Anglo American - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- ASAPP Information Group - India
- Tamil Nadu electricity Board
- Kepco SPC Power Corporation, Philippines
- Petron Corporation, Philippines
- Latin American Coal - Colombia
- Directorate Of Revenue Intelligence - India
- Meenaskhi Energy Private Limited - India
- Rashtriya Ispat Nigam Limited - India
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- India Bulls Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meralco Power Generation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Sojitz Corporation - Japan
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
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- Australian Coal Association
- Africa Commodities Group - South Africa
- Xindia Steels Limited - India
- White Energy Company Limited
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Sakthi Sugars Limited - India
- Oldendorff Carriers - Singapore
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Maheswari Brothers Coal Limited - India
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- Kartika Selabumi Mining - Indonesia
- Marubeni Corporation - India
- GVK Power & Infra Limited - India
- Uttam Galva Steels Limited - India
- Wilmar Investment Holdings
- Karbindo Abesyapradhi - Indoneisa
- Minerals Council of Australia
- Binh Thuan Hamico - Vietnam
- Simpson Spence & Young - Indonesia
- Indika Energy - Indonesia
- Energy Link Ltd, New Zealand
- Ministry of Finance - Indonesia
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- Central Java Power - Indonesia
- The Treasury - Australian Government
- Economic Council, Georgia
- Aditya Birla Group - India
- Kapuas Tunggal Persada - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Agrawal Coal Company - India
- Planning Commission, India
- Ambuja Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Eastern Coal Council - USA
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- Kaltim Prima Coal - Indonesia
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- Sical Logistics Limited - India
- Sree Jayajothi Cements Limited - India
- Jorong Barutama Greston.PT - Indonesia
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- Larsen & Toubro Limited - India
- Global Business Power Corporation, Philippines
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Leighton Contractors Pty Ltd - Australia
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Mines - Canada
- PNOC Exploration Corporation - Philippines
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Bhatia International Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Commonwealth Bank - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Bangladesh Power Developement Board
- Madhucon Powers Ltd - India
- Indo Tambangraya Megah - Indonesia
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- SMG Consultants - Indonesia
- Attock Cement Pakistan Limited
- Semirara Mining Corp, Philippines
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Barasentosa Lestari - Indonesia
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Electricity Generating Authority of Thailand
- Kideco Jaya Agung - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Coastal Gujarat Power Limited - India
- Ministry of Transport, Egypt
- European Bulk Services B.V. - Netherlands
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- Alfred C Toepfer International GmbH - Germany
- Mercator Lines Limited - India
- Orica Mining Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Rio Tinto Coal - Australia
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
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- Formosa Plastics Group - Taiwan
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