CIL chairman and managing director A K Jha in a recent interview told FE that the company was looking for coking coal assets in Russia, Australia and Canada to secure coking coal supplies for the steel industry.
Union coal minister Prahlad Joshi on Wednesday said that his ministry was not keen to acquire any coal assets abroad and aims to produce the required quantity in India instead to protect foreign exchange outflow. The country imported 235 million tonne last year and forked out 27.1 lakh crore. ” We want to cut on our import bill,” Joshi said.
While Coal India ( CIL) is in looking for assets in Russia, Canada and Australia, the minister’s statement has blown up a controversy whether it was against the decision of the ministry that CIL was in pursuit for assets abroad. “We are not thinking to acquire coal assets but we only want to freeze the order in advance to get coal at competitive prices,” Joshi said at the eighth Asian Mining Congress. However, CIL officials later clarified that CIL was only looking for coking coal assets abroad and was neither looking for any thermal coal assets nor it was keen to acquire any.
CIL chairman and managing director A K Jha in a recent interview told FE that the company was looking for coking coal assets in Russia, Australia and Canada to secure coking coal supplies for the steel industry. But he couldn’t divulge further details on the acquisition since the ‘disclosure agreements on the properties were not signed’.
On picking up stakes of coking coal mines in Australia, CIL was in the process of appointing a merchant banker, for which the company initiated to prepare the tender documents for inviting expression of interest. But the chairman made clear that the CIL board didn’t clear the proposal of appointing a merchant banker since not many major global merchant bankers were engaged in doing due dilegence for coal properties, because they considered coal as a ‘dirty fuel’, Jha said.
However, a ministry official later made clear, that although the ministry was averse to acquire an entire coking coal block abroad, it was not against picking up stakes in operational mines. CIL may sign definitive agreements for mines in Canada and Australia by the end of this fiscal.
On the question of FDI in coal, Joshi said FDI will come in the coal sector but by no means in Coal India. ” We want that Coal India continues to be the largest coal producing company with India.” CIL was also working on coal bed methane and a global tender for that would be shortly materialised. But at the same time ‘since it would be an international tender, there are many uncertainties involved in it. But the tender is in process,’ Joshi said.