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Monnet Group plans to sell thermal coal from its recently acquired mine in Indonesia to customers in China, Japan, South Korea and Vietnam.
One of the objectives for acquiring the coal mines of PT Sarwa Sembada Karya Bumi in the Jambi province of Sumatra was to ensure raw material security for its upcoming power plants in India. Pending commissioning of these plants, it will start coal trading by the end of this calendar year.
Spread over 25,000 hectares, the mine that Monnet acquired for $24 million has been explored only for some 1,500 hectares, in which alone coal reserves have been estimated at 65 million tonnes.
“We plan to hire a contract firm to start coal mining, which may take about six to nine months,” said Mr Sandeep Jajodia, Vice-Chairman and Managing Director, Monnet Group. The company proposes to set up a jetty to evacuate coal and is planning to invest about $10 million in building the required infrastructure over a period of time, Mr Jajodia said.
May hire ships
Monnet is also exploring options to get into the logistics to ship the coal. “We are planning to hire ships on long-term charter. We have done some soft enquiries in Singapore, the shipping hub of South East Asia and are still evaluating the quotes,” Mr Jajodia said.
Monnet Group, through its subsidiary – Monnet Power – is setting up a 1,050 MW coal-fired power plant at Angul in Orissa. The first unit of 525 MW is likely to be commissioned towards end of 2012. Further, the company is also planning to setting up another 1320 MW power project, for which the location is yet to be finalised, Mr Jajodia said.
Private equity firm Blackstone has picked up a 12.5 per cent stake in Monnet's 1,050 MW power plant that has already secured coal linkages. The company expects to start coal mining from the allocated Utkal B2 block, which is located at a distance of 4 km from the proposed power plant, by July 2012. “We plan to install a conveyor belt to evacuate coal to the power plant from the Utkal B2 block,” he added.
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