SHANGHAI (Reuters) - Peabody energy (BTU).(N), a joint venture between China - Shenhua (1088.HK) and Mitsui & Co (8031.T of the Japan) and a consortium led by the Russia was chosen as the winning preliminary jointly develop the deposit of coal Tavan prized here, a senior government source said Monday.
Tavan here is touted as one of the largest untapped coking coal in the world, that global steel makers such as ArcelorMittal (ISPA.)(AS) and Posco (005490.KS), are anxious to ensure, as long as quality deposits became more difficult to find and the demand for steel have indeed soar coal prices.
Last week, the Government said it had decreased by half the shortlist of bidders for the Western block of the Tsankhi three of six, but he did not say if it would reduce the list more far.
The decision, which is still subject to approval by the Mongolian Parliament, comes after a long delay in the development of the massive deposit - with estimated 6 billion tons of coal reserves, including the largest deposit untapped in the world of steel coking coal.
The project, in the South of the Mongolia Gobi region, is not only regarded as vital to the economy of the country to revive the coastline, but will generate billions of dollars of revenue for the companies concerned and add tens of millions of tons of coal to coke more in rarer world reserves each year.
"They are the preliminary winners and all the materials of negotiation have already submitted to Parliament for discussion," resources officer and the Department of energy Mongolia said Reuters by telephone.
"It is sufficient to obtain an authorization from the Parliament... the intent is to have the three parties to jointly develop Tavan here," said the official who did not want to be named as the news was not public.
If Parliament were to disapprove of Peabody participation for any reason whatsoever, the Government would then other groups of mines that had been previously selected
Vale (VALE5.)(SA) or Xstrata Plc (XTA.)(L) - to replace the U.S. minor, said the source.
He said no there was no date limit for when Parliament would vote on the proposal, but is that a decision should be made prior to July 11, when the spring session of Parliament ends.
Japanese-Korea-Russian consortium members include POSCO (005490.KS), company of the utility KEPCO (015760.KS), trading firm LG Corp and Daewoo International, State, Russian railways and trading houses Japanese Itochu Corp. (8001.T), Sumitomo Corp (8053.T), Marubeni Corp (8002.T) and Sojitz Corp. (2768.T).
The tender is to develop the Western block of Tsankhi, which owns approximately 1.2 billion tons of reserves, with a life for the production of forecasts in 30 years to 15 million tonnes per year.
However, with the deposit located in the middle of a vast desert which has virtually no access to roads, railways and power, some observers believe that winners need to perhaps to more than 7 billion $ as an initial pump investment.
Separately, the block of coal is Tsankhi will be developed by Tavan Erdenes owned here Ltd., which the Government is in an initial public offering that could raise as much as $ 10 billion to develop the field of planning.
ON THE POLICY
For the enclave Mongolia, the selection process have been laced with political concerns, as the country seeks to strengthen its approximately 6 billion to economy by mining revenues.
The Mongolia relies heavily on China for its exports of commodities, but is in talks to access the ports and railways of the Russia that it seeks to create new trade links with other far East countries.
"So far, it feels like more of a geopolitical decision and trade is the kind of second, said Dale Choi, strategist, investment brokerage Frontier Securities in Ulaanbaatar leader."
"The Government seeks to involve all three, have a cooperation between the three groups. It will be complicated, since there are so many companies. »
However, analysts said that a logical combination that the company Shenhua-Mitsui and Russia-Korea-Japanese consortium lack experience in coal coking developing.
"Peabody can help fill this gap," said Overseas-Kay Hian Helen Lau senior metals analyst.
(Additional by Elzio t. Barreto Jr. in HONG KONG.) (Editing by Jason Subler and Anshuman Daga)
No comments:
Post a Comment