Lanco Infratech said it has won a ruling from an Australian court that allows its unit Griffin Coal to revise a coal supply agreement with Bluewaters Power Station. The Supreme Court of Western Australia rejected the plea from Perdaman Chemicals and Fertilisers Pty (PCFL) on the issue, Lanco said. PCFL, run by Indian-origin entrepreneur Vikas Rambal, is embroiled in a A$3.5 billion litigation with Lanco over fuel supplies from Griffin Coal.
“The revised CSA will result in a gain of approximately A$150 million in NPV terms, including a substantial upfront payment to Griffin Coal Mining Company Pty,” Lanco Infratech chairman L Madhusudhan Rao said in a statement. Lanco’s share surged more than 7% to close at R13.46 on Monday on the BSE.
The company, through its Australian subsidiary Lanco Resources Australia, had acquired Griffin Coal and Carpenter Mine Management for about A$720 million in February last year. Griffin Power entities (Bluewaters) are in the process of being acquired by Japanese consortium of Sumitomo Corp and Kansai Electric Power.
“This (ruling) is a milestone for Lanco. Griffin is coming to a good shape... We will be getting more revenues once the revised CSA is in place,” Lanco CEO (Business Development) Nagaprasad Kandimalla said.
According to Kandimalla, the revised pact is expected to be signed by the middle of January 2013.
Australia’s vast natural resources have attracted a stream of Indian investment, with the Adani Group, GVK Industries, Aditya Birla, and Reliance Industries among the companies to have invested in the country.
Griffin Coal has a long-term fuel supply agreement with Bluewaters Power Station. A Japanese consortium of Sumitomo Corp and Kansai Electric Power Co are to acquire the Bluewaters plant.
Griffin Coal would supply about 1.8 million tonnes of coal to Bluewaters over a period of about 20 years. Last year Griffin produced over 3 million tonne of coal.
Meanwhile, PCFL has alleged that Lanco is not complying with the coal supply pact — inked with Griffin Coal — for Perdaman’s upcoming urea plant in Western Australia.
In a separate notice to the BSE, the company said it has appointed Ernst & Young to help find suitable investors 1,200 MW