NTPC has readied a war chest of around Rs 1.6 lakh crore for the next five years even as it closes in on a coal mine in Western Australia to source fuel for its power projects
Its other co-owned special purpose vehicle, International Coal Ventures Ltd (ICVL), has also shortlisted a coal mine in Australia for acquisition.
“This should help our country immensely as we look at bridging the domestic coal supply-demand shortfall,” the NTPC Chairman and Managing Director, Mr R.S. Sharma, told newspersons at the sidelines of an India-Australia conference on energy and minerals.
“ICVL is close to acquiring a mine in Queensland, which has estimated reserves of 221 million tonnes. They have appointed merchant bankers, legal advisors and technical experts to do the due diligence,” Mr Sharma said.
In the case of ICVL, the coal mines will be acquired; but for NTPC, Mr Sharma, they plan to buy a stake in coal mines. “We would rather buy a stake, even if it is a majority stake rather than fully acquire the assets,” he said.
ICVL is a special purpose vehicle formed jointly in 2008 by SAIL, NTPC, Coal India, Rashtriya Ispat Nigam Ltd and National Mineral Development Corporation. But it has not made much of a dent since it began operations.
Mr Sharma said NTPC has zeroed in on mines in Western Australia to secure thermal coal assets. “We are doing due diligence in Western Australia on mines with estimated reserves of 350-400 million tonnes,” he said.
He said NTPC plans to buy a stake in an existing mine with reserves of around 150 mt and the rest will be through a new coal mine. For both, NTPC will have to make an official bid. Mr Sharma did not share details of the investment for buying stakes in these mines but said for one million tonne of coal, an investment of $100200 million (Rs 470-940 crore) is required.
He said a large part of the funding will be through debt. “Our debt-equity ratio is 70:30 and the debt part of the funding has already been tied up,” he said.
NTPC has cash reserves of Rs 18,000 crore while its capex for the current year is about Rs 29,000 crore. “We do apportioning of these investments as and when we want to acquire an asset,” he pointed out.In 2009-10, India imported about 60 mt of coal and this figure is expected to rise to 100 mt during the current fiscal.
Its other co-owned special purpose vehicle, International Coal Ventures Ltd (ICVL), has also shortlisted a coal mine in Australia for acquisition.“This should help our country immensely as we look at bridging the domestic coal supply-demand shortfall,” the NTPC Chairman and Managing Director, Mr R.S. Sharma, told newspersons at the sidelines of an India-Australia conference on energy and minerals.
“ICVL is close to acquiring a mine in Queensland, which has estimated reserves of 221 million tonnes. They have appointed merchant bankers, legal advisors and technical experts to do the due diligence,” Mr Sharma said.
In the case of ICVL, the coal mines will be acquired; but for NTPC, Mr Sharma, they plan to buy a stake in coal mines. “We would rather buy a stake, even if it is a majority stake rather than fully acquire the assets,” he said.
ICVL is a special purpose vehicle formed jointly in 2008 by SAIL, NTPC, Coal India, Rashtriya Ispat Nigam Ltd and National Mineral Development Corporation. But it has not made much of a dent since it began operations.
Mr Sharma said NTPC has zeroed in on mines in Western Australia to secure thermal coal assets. “We are doing due diligence in Western Australia on mines with estimated reserves of 350-400 million tonnes,” he said.
He said NTPC plans to buy a stake in an existing mine with reserves of around 150 mt and the rest will be through a new coal mine. For both, NTPC will have to make an official bid. Mr Sharma did not share details of the investment for buying stakes in these mines but said for one million tonne of coal, an investment of $100200 million (Rs 470-940 crore) is required.He said a large part of the funding will be through debt. “Our debt-equity ratio is 70:30 and the debt part of the funding has already been tied up,” he said.
NTPC has cash reserves of Rs 18,000 crore while its capex for the current year is about Rs 29,000 crore. “We do apportioning of these investments as and when we want to acquire an asset,” he pointed out.In 2009-10, India imported about 60 mt of coal and this figure is expected to rise to 100 mt during the current fiscal.
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