State-owned Coal India is expected to seal deals worth $1.8 billion (about Rs 8,000 crore) with foreign firms in the next two months for mining coal abroad.
"We are in the process of finalising $1.8 billion foreign partnership pacts for mining about 280 million tonnes of coal overseas. The due diligence on five proposals are going on and deals could be concluded in 1-2 months," Coal India Ltd Chairman Partha S Bhattacharyya told PTI.
The company has already appointed consultants for fast-tracking the proposed ventures. "We have appointed three consultants - DSP Merrill Lynch, Royal Bank of Canada and Royal Bank of Scotland - for advising on the proposed ventures," he said.
The world's largest coal producer, which meets over 80 per cent of India's requirement of the dry fuel, has already named US-based Peabody as a possible ally for such ventures. "We are evaluating five proposals from three global firms for such partnerships in countries like Australia, Indonesia and the US," he added.
At present, the company is looking to forge equity and joint venture agreements with the concerned companies, but it may consider entering into offtake pacts later.
For the current fiscal, CIL has earmarked a capital expenditure of about Rs 10,000 crore (Rs 100 billion), 60 per cent of which would be channelised for such global deals.
In its bid to expand its global footprint, Coal India had last year sought partnerships from global firms. The Expression of Interest saw firms like Rio Tinto and Peabody evincing interest.
Ultimately, the company shortlisted 10 proposals from five international firms for overseas ventures. The company is also undertaking expansion of its domestic operations to meet rising demand especially from the power sector.
CIL says it is sitting on a cash pile of Rs 30,000 crore (Rs 300 billion) and does not require to raise funds for its growth projects. The government is expected to sell 10 per cent of its stake in the Navratna company by July-August, which may mop up around Rs 12,000 crore (Rs 120 billion) for the Centre, which needs the money to part finance its social and infrastructure programmes.
