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ICVL eyes coal assets, puts Mongolia bid

ICVL eyes coal assets, puts Mongolia bid

New Delhi: State-run International Coal Ventures Ltd (ICVL) consortium has submitted a bid for a Mongolian coal mine, as it steps up its hunt for overseas assets after backing away from a counter bid for Australia miner Riversdale .

The consortium submitted the bid for the Mongolian mine on 31 January, Ajay Mathur, nodal officer for ICVL said on the sidelines of an industry conference.

He declined to give the financial details of the bid.

A source with knowledge of the matter said on Tuesday steelmaker ArcelorMittal and miner Vale are among 15 groups that applied to take part in the bidding to develop Mongolia’s Tavan Tolgoi coal mine.

Among other applicants are Xstrata , Peabody Energy , and ICVL, the source said, declining to be named because the bidding process has not been made public.

The mine is regarded as one of the world’s biggest untapped reserves with an estimated reserve of 6 billion tonnes.

ICVL comprises of utility NTPC Ltd , Steel Authority of India Ltd , iron ore miner NMDC , Coal India and Rashtriya Ispat Nigam.

The consortium was hopeful of acquiring two to three coal assets in Australia and Indonesia in 2011, and could look for mines in Mozambique as well, Mathur said.

“We are hopeful of acquiring assets or having equity participation in two to three opportunities in Australia and Indonesia," he said, adding the consortium has completed due diligence on Queensland and New South Wales assets in Australia.

In January 2011 the consortium decided not to counter Rio Tinto’s $3.9 billion bid for Riversdale.

In addition to Australia and Indonesia, the consortium is looking to buy coal assets in the US, P.K. Bishnoi, chairman of steelmaker Rashtriya Ispat Nigam Ltd said at the same event.

The four listed state firms in the group held combined cash reserves of around $9.6 billion as of the end of September 2010, but all four also have ambitious expansion or acquisition plans of their own.

Indian steel, power and coal companies have been scouting for overseas coal mines to satisfy demand from the fast-growing economy, Asia’s third largest.

ICVL was set up in 2009 for buying coal assets overseas to meet the needs of member firms but has met with little success so far.

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