ON A SAFARI

Calcutta, Sept. 25: Gremach Infrastructure Equipments & Projects has acquired a 75 per cent stake in 11 coal mine licences in Mozambique.

Last month, JSW Steel and Tata Steel had acquired coking coal mines in the African country.

Gremach’s acquisition is the largest in terms of the number of mines and land cover. The 11 coal mines are spread over 13,250 hectares in Moatize, which has rich deposits of hard coking coal.

“It is like getting a licence to mine black gold,” said vice-chairman Rishi Raj Agarwal.

JSW Steel acquired three licences for exploring and mining coke in Mozambique. The 6,900-hectare area is expected to have 200 million tonnes of reserves.

In the first week of August, Tata Steel acquired a 35 per cent stake in Riversdale Mining’s coal project in Mozambique for $85 million.

Riversdale’s coal project in the African country has mining licences of hard coke tenements covering 24,960 hectares. Tata Steel has bought a stake in the project to get an assured supply of coke for the Corus plants in the UK and Europe.

Agarwal did not disclose the amount the company is paying to buy the stake.

However, he said two mines with a capacity of 200 million tonnes would be developed at an investment of $100 million by mid-2008.

“The reserves of other mines will be known after the prospecting surveys are done. But it should be in billion tonnes,” Agarwal said.

“These 11 licences are very close to the existing Companhia Vale do Rio Doce mines that have proven reserves of high-quality hard coke,” he added.

According to Agarwal, Gremach may also buy the remaining 25 per cent stake in future. The company has bought the stake from local companies that were the licensees.

Africa has rich deposits of hard coke, a mineral that is in short supply globally.

The cost of developing coal mines in this part of the world is also much less than that in Australia.

Indian companies are also making a beeline for coal mining licences in Indonesia. “We are at an advanced stage of acquiring a large mine for semi-soft coke in Indonesia,” Agarwal said. “The acquisition will hopefully be complete within a month,” he added.

Trading in the Gremach scrip on the BSE was stopped during mid-session today as its share price hit the upper circuit. The share rose 4.98 per cent to Rs 266.60.