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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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Wednesday, 19 December 18
GLOBAL COAL DEMAND SET TO REMAIN STABLE THROUGH 2023, DESPITE HEADWINDS - IEA
While global coal demand looks set to rise for the second year in a row in 2018, it is forecast to remain stable over the next five years, as decli ...
Wednesday, 19 December 18
GLOBAL SHIPPING SCOUTS FOR FUTURE GROWTH - PETER SAND, BIMCO
Where do we go to find economic growth that spurs shipping demand in the next five years? According to the International Monetary Fund (IMF), we sh ...
Wednesday, 19 December 18
SHIPPING MARKET INSIGHT - INTERMODAL
As another year is coming to an end, it is interesting to look at the main shipping markets and how these performed compared to 2017.
&nb ...
Tuesday, 18 December 18
COAL DEMAND WILL REMAIN STEADY THROUGH 2023, INTERNATIONAL ENERGY AGENCY SAYS - TOM DICHRISTOPHER, CNBC
Coal consumption is on the rise but will remain roughly stable over the next five years, the International Energy Agency forecasts.
...
Tuesday, 18 December 18
DRY BULK: IN ABSOLUTE TERMS, ALL MAIN SIZE SEGMENTS SAW THEIR ACTUAL VOLATILITY FIGURES DECREASE - ALLIED
Since the beginning of 2016, when the dry bulk market reached its absolute bottom, freight rates have been ever since on an upward trajectory. Taki ...
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- Pendopo Energi Batubara - Indonesia
- Metalloyd Limited - United Kingdom
- Sakthi Sugars Limited - India
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- Wood Mackenzie - Singapore
- Cement Manufacturers Association - India
- Latin American Coal - Colombia
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- Bharathi Cement Corporation - India
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- New Zealand Coal & Carbon
- Planning Commission, India
- Australian Commodity Traders Exchange
- Baramulti Group, Indonesia
- Indian Oil Corporation Limited
- Barasentosa Lestari - Indonesia
- Malabar Cements Ltd - India
- Heidelberg Cement - Germany
- Power Finance Corporation Ltd., India
- MS Steel International - UAE
- GN Power Mariveles Coal Plant, Philippines
- The State Trading Corporation of India Ltd
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- Coastal Gujarat Power Limited - India
- Attock Cement Pakistan Limited
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- Energy Development Corp, Philippines
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- The Treasury - Australian Government
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- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
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- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Straits Asia Resources Limited - Singapore
- Sarangani Energy Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
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- Trasteel International SA, Italy
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Samtan Co., Ltd - South Korea
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Xindia Steels Limited - India
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- Eastern Energy - Thailand
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- Meralco Power Generation, Philippines
- TeaM Sual Corporation - Philippines
- Salva Resources Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- South Luzon Thermal Energy Corporation
- Kobexindo Tractors - Indoneisa
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- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
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- Orica Mining Services - Indonesia
- Merrill Lynch Commodities Europe
- Ambuja Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- Economic Council, Georgia
- Central Electricity Authority - India
- GVK Power & Infra Limited - India
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- Sindya Power Generating Company Private Ltd
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Singapore Mercantile Exchange
- Posco Energy - South Korea
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Coalindo Energy - Indonesia
- Independent Power Producers Association of India
- IHS Mccloskey Coal Group - USA
- Chamber of Mines of South Africa
- Bhoruka Overseas - Indonesia
- Madhucon Powers Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Directorate Of Revenue Intelligence - India
- Indogreen Group - Indonesia
- PowerSource Philippines DevCo
- Marubeni Corporation - India
- Ministry of Finance - Indonesia
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- SMC Global Power, Philippines
- Vizag Seaport Private Limited - India
- Kideco Jaya Agung - Indonesia
- Aboitiz Power Corporation - Philippines
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- LBH Netherlands Bv - Netherlands
- Karaikal Port Pvt Ltd - India
- Larsen & Toubro Limited - India
- Oldendorff Carriers - Singapore
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- PTC India Limited - India
- Billiton Holdings Pty Ltd - Australia
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Bhushan Steel Limited - India
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- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Sical Logistics Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Makarim & Taira - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Port Waratah Coal Services - Australia
- Alfred C Toepfer International GmbH - Germany
- Global Green Power PLC Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
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- Thiess Contractors Indonesia
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Tamil Nadu electricity Board
- OPG Power Generation Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Kapuas Tunggal Persada - Indonesia
- Jaiprakash Power Ventures ltd
- Georgia Ports Authority, United States
- India Bulls Power Limited - India
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- Semirara Mining Corp, Philippines
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- Global Business Power Corporation, Philippines
- Australian Coal Association
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- White Energy Company Limited
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- Agrawal Coal Company - India
- Orica Australia Pty. Ltd.
- Kartika Selabumi Mining - Indonesia
- Aditya Birla Group - India
- GMR Energy Limited - India
- Formosa Plastics Group - Taiwan
- Dalmia Cement Bharat India
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- ASAPP Information Group - India
- Directorate General of MIneral and Coal - Indonesia
- Rio Tinto Coal - Australia
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Riau Bara Harum - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rashtriya Ispat Nigam Limited - India
- Bukit Makmur.PT - Indonesia
- Tata Chemicals Ltd - India
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Medco Energi Mining Internasional
- The University of Queensland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Karbindo Abesyapradhi - Indoneisa
- Energy Link Ltd, New Zealand
- Coal and Oil Company - UAE
- Uttam Galva Steels Limited - India
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- Therma Luzon, Inc, Philippines
- Parry Sugars Refinery, India
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