Mumbai: India’s Tata Power Co. is eyeing coal assets in Australia and South Africa, following a $1.3 billion (Rs5,620 crore) deal to buy stakes in two Indonesian mines to feed its new Indian power plants, a top official said on 2 April.
The company, part of India’s salt-to-software Tata Group, plans to add 10,000 megawatts of power generation capacity in the next six years, managing director Prasad Menon said.
“This means that we would be about five to six times of our present size,” he said.
Menon said the utility would need about 21 million tonnes of imported coal, half of which would come from the Indonesian deal.
On 31 April, Tata Power signed a deal with PT Bumi Resources to buy 30% stake in Bumi’s PT Kaltim Prima Coal and PT Arutmin Indonesia, two of Indonesia’s largest coal mines, and a related trading company.
“By taking fairly high equity, we get right into the bowels of that company and get access to coal,” Menon said.
The Indonesian coal will be used for two proposed power projects -- Mundra in the western state of Gujarat and Ratnagiri in neighbouring Maharashtra -- with capacity to generate a total of 7,000 megawatts.
“We would not like to keep our eggs in one basket,” Menon said, explaining why Tata Power is looking elsewhere for more coal.
Menon said the company’s proposed 3,000 megawatts projects in eastern India would run on domestic coal.
Tata Power, which posted a net profit of $64.4 million for the fiscal third-quarter ended 31 December plans to raise 50-70% of the Indonesian acquisition cost in foreign debt, S Ramakrishnan, executive director of finance, said.