To explore possibilities of strategic alliances.
Coal India officials along with the Union coal minister will visit Australia this weekend to explore opportunities for strategic partnership. The company has recieved substantial response from Australian firms on the global expression of interest that it floated in July. “We have received good response from Australian companies. We hope to explore opportunities for forming strategic partnership there,” said Partha S Bhattarcharyya, chairman, CIL on the sidelines of the 78th annual general meeting of the Indian Coal Merchants’ Association. The company will be looking at coal assets and or acquiring assets through strategic partnerships.
Over 100 mining firms from Australia, the US, Indonesia and South Africa have evinced interest in the EoI. CIL had invited Expression of Interest (EoI) in July for selection of strategic business partners in Australia, the US, Indonesia and South Africa for joint business initiatives in coal mining. The deadline for these overseas mining firms for responding to the EoI notice is August 31.CIL may forge joint ventures with select mining firms or pick up stakes in their operational mines.
In a parallel development, CIL today announced that the offtake pay clauses had been modified. The coal consumers earlier had to furnish an undertaking that they would accept imported coal of CIL at a higher price to the extent the coal company was unable to effect such supply domestically.
This clause which was mandatory earlier has been withdrawn. “Now the consumers can have the option of either taking or not taking the imported coal of CIL,” said Bhattarcharyya. CIL is planning to import close to four million tonnes this fiscal to meet the demand of the power generating firms.
This is the first time that the PSU will be importing coal on its own. The target has been set by the Planning Commission. The domestic coal demand is projected to be 730 million tonnes (mt) by 2011-12. But domestic coal production by then is pegged at 520 mt thereby creating a shortfall of over 200 mt.