Reliance Power acquires three Indonesian coal mines for $1.6 billion
10 Jun 2010
Anil Dhirubhai Ambani Group Reliance Power Limited today said it had acquired three coal mines in Indonesia from Sugico Group, in a deal that could be as much as $1.6 billion.
Reliance Power's wholly-owned subsidiary, Reliance Coal Resources, has entered into a share sale agreements with Sugico to buy the entire share capital of its group companies, PT Srivijaya Bintangtiga Energi and PT Bryayan Bintangtiga Energi in a staggered payment deal.
Reliance Power will make an upfront payment of $106 million and the balance to be paid linked to production targets, which could be as much as $1.6 billion, said The Economic Times in a report today.
The combined coal reserves of the three mines are two billion tons, which will help the Navi-Mumbai-based company to fire its 4,000 MW power plant at Krishnapatnam in Andhra Pradesh and other power projects.
The company is currently developing 16 large and medium sized power projects with a combined planned installed capacity of 33,780 MW, one of the largest portfolios of power generation assets under development in India.
They include seven coal-fired projects of 18,880 MW to be fueled by reserves from captive coal mines and supplies from India and abroad.
Reliance Power now joins other Indian power and steel companies in securing coal assets overseas. But most Indian companies are targeting Indonesia, since its coal is has a lower ash content and the transportation costs are far lower than imports from Australia or Africa.