KOLKATA (miningweekly.com) – India’s Singareni Collieries Company Limited (SCCL) has set up a corpus of about $80-million to acquire an equity stake in an overseas coal block.
The southern India-based miner is seeking to pick up the stake to secure coal supplies of at least five-million tons a year, as part of a plan to ramp up capacity to 80-million tons a year from 51-million tons a year.
The increased production and incremental supplies from overseas will be necessary for SCCL to establish fuel linkages to its various thermal power projects.
Though no specific acquisition target had been identified, a senior company official said that Australia and South Africa would be the most favourable destination for SCCL’s maiden foreign investments considering that both countries would meet a requirement of hosting coal blocks close to the coastline and access to ports.
While not willing to divulge details of proposals already received, he said the targets for investment had a minimum coal reserve of 50-million tons and would meet the requirement of supplying at least five-million tons a year to the Indian miner.
SCCL hinted that Australia may be just ahead as the favoured investment destination.
Last week, an Australian delegation led by a member of the diplomatic corp, met top SCCL officials to discuss coal investment opportunities.
The delegation also offered help in identification of coal blocks matching SCCL's requirements and even offered facilitation in identification of suitable technology in managing coal blocks in that country.
It was decided that the visit would be followed up in July by a team of mining technologists and engineers to look into the management and technical training needed for SCCL to establish a presence overseas.
SCCL’s immediate priority was to complete the 2 x 600 MW thermal power project located in Adilabad district, in Telengana, within the current calendar year and ensure dry fuel feedstock from the company’s existing mines. Plans to add another 8000 MW of thermal power generation capacity were on the drawing board and SCCL would have to ramp up coal availability from its domestic mines, as well as ensure supplies from overseas.
At home, SCCL had started work on expanding two mines – one opencast and another underground. The capacity of the opencast mine would be increased to 3.5-million tons a year from 2.5-million tons a year.
SCCL currently operated 32 underground mines and 16 opencast mines across the coal reserves at the Godavari River Valley, which had estimated reserves of 10-billion tons along a single stretch of 350 km.