Calcutta, Dec. 19: The Visa group has acquired a coal mine at Queensland in Australia.

Visa Steel, which is setting up a 1.5-million-tonne steel and stainless steel plant in Orissa, will source its coking coal from the Australian mine at a competitive price. The acquisition was routed through Visa Comtrade AG, the group’s Swiss outfit.

Chairman Vishambhar Saran said the long-term agreement with the Australian miner would not only guarantee secured supply of coal but also at a cheaper price. He, however, declined to reveal the investments made in the venture.

So far, Tata Steel is the only steel firm from India to acquire coal mines in Australia.

Gujarat NRE Coke, the country’s largest non-captive met coke producer, is the other company to pick up stakes in coal mines in Australia.

India imports 17 million tonnes of coking coal from Australia, bulk of which is produced by Queensland. The import level is set to increase exponentially, as India aims to produce 100 million tonnes of steel by 2020.

Coking coal became a hot property when international prices shot up last year coupled with erratic supply. Companies like the Steel Authority of India Ltd had faced problems on procurement. Coal prices went through the roof to hit $125 a tonne from $60 a tonne in the previous year.

Since Indian coals are high in ash content, Indian steelworks import 35-40 per cent of their requirement to blend with the Indian coal to get maximum performance from blast furnaces.

With steel production slated to go up, India might be required to import additional 5-7 mt of coking coal in the near term and about 20 mt in the long run.

Since most of the mines are booked on long term, Indian companies generally buy on a spot basis and pay more. This acquisition will help visa negotiate a better price.

The first phase of Visa’s proposed steel plant, which will have 0.5 million tonne capacity, will become commercially operational by December 2007, while the coke oven plant is schedule to be commissioned in March 2006.