Minews - Indian firms hope to buy foreign coal mines soon

(Minews) - Reuters reported that a consortium led by Steel Authority of India Limited hopes to buy coal mines overseas in the next few months when it has completed due diligence on facilities in Indonesia, Mozambique and the United States.

Most steel producers in India, the world's No.3 coal importer, depend on overseas coal shipments and have been trying to buy mines in Africa and Europe.

JSW Steel Limited has already bought US mines that produce the coal used in steel making. Some other private companies have also acquired mines in Australia. India's demand for steel making coal is expected to triple by 2020 to 2021, with about 90% of that coming from abroad.

Mr Ajay Mathur CEO of International Coal Ventures Limited said that "We're doing due diligence in three to four geographies such as Indonesia, Mozambique and the United States, the consortium led by SAIL. Mozambique is logistically quite well suited for India. Whatever
has come out of Vale and Rio's (operations) from Mozambique looks to be of good quality."

ICVL, whose five participating firms are all state-owned or state controlled, has been scouting for mines since 2009 but has not been able to buy any yet as it is looking for big mines that can produce at least 50 million tonnes per year.

Mr CS Verma chairman of SAIL and ICVL said that "We should be able to sign a deal in the next few months. We have already invested a lot in doing due diligence, appointing investment bankers. This shows how serious we are"