India joins global scramble for coal


CSA Z463 Electrical Maintenance -

Our customized live online or in‑person group training can be delivered to your staff at your location.

  • Live Online
  • 6 hours Instructor-led
  • Group Training Available
Regular Price:
$249
Coupon Price:
$199
Reserve Your Seat Today

India Coal Mine Acquisitions drive energy security as CIL targets overseas assets in Australia, Indonesia, and the US, amid OPEC oil dynamics, China demand, thermal power needs, joint ventures, and volatile coal pricing and geopolitics.

 

At a Glance

India’s strategy, led by CIL, to buy stakes in overseas coal mines to secure power fuel and stabilize supply chains.

  • CIL targets stakes in ~20 overseas mines with $2B war chest.
  • Aims for 500 Mt assured coal supply over the next decade.
  • India's demand may hit 731 Mt; domestic output may fall short.

 

The rush to own coal in any form seems to be a global obsession, whether in mature, developing, or underdeveloped economies.

 

The cartelization of oil producers under the Organization for Petroleum Exporting Countries (OPEC), as well as the fact that many alternative sources of energy remain commercially unviable, have ensured that coal remains an economical and desirable source of energy for India's coal dependence in the near term. Luckily, the coal owning or producing nations have not yet formed a cartel. India, the world's second-fastest emerging economy is no different than other countries.

The country needs more coal, as power plants are dangerously low across India.

Indian companies, both state-owned and private, are scrambling to capture coal mines through overseas acquisitions throughout the world. Coal India Limited (CIL), fully owned by the government of India, recently announced the intention to acquire a stake in about 20 coal mines across the globe. Australia, Indonesia and the United States are on the company's radar.

CIL has a war chest of $2 billion, which it hopes to invest before July this year, including targets in Appalachia under review. Nine investment proposals are lying on CIL's tables for finalization. This move is expected to give CIL an assured supply of 500 million tonnes of coal in the next decade, said CIL Chairman Partha Bhattacharyya.

Government data projects India's need for coal will be about 731 million tonnes by 2011-12, with 100 million-ton imports by 2012 under consideration. Through technological innovation and managerial efficiency, the country could manage to mine 680 million tonnes, leaving about 50 million tonnes that need to be imported.

The obvious question: At what price?

Given China's hunger for all forms of fuel to provide fodder for its relentless growth, there will be a mad scramble by the country for coal supplies in the coming years, which will obviously impact global coal prices. For Indian companies needing thermal power, and with 35 million tons for 2010-11 slated for import, ownership of coalmines abroad is an increasingly viable strategy.

The latest estimates project that 201 coal blocks, with geological reserves of approximately 46 billion tonnes, have been identified in India and allotted to government and private companies.

As of December 31, 2009, the country's total coal production was about 493 million tonnes, and as King Coal returns with new technologies, the projection that the supply would reach 680 million tonnes within 24 months appears dicey. If so, the additional shortfall would be a blessing in disguise for global coal suppliers, enabling them charge an extra premium for every million tonnes sold.

However, some coal experts in India believe that the global climate debate and the decision to reduce carbon emissions will compel many coal miners to exhaust their supply as early as possible at any price.

This mad scramble for coal has led to global giants such as Peabody Energy Corporation, Massey Energy Company and India Resources Limited aggressively scouting for joint venture options with Indian companies such as Jindal Steel & Power Limited and Mercator Lines Limited. Shipping companies' interest stems from floating offshore coal warehousing — a practice common in the global oil scenario.

Related News

Kenya Power on the spot over inflated electricity bills

Kenya Power token glitches, inflated bills disrupt prepaid meters via M-Pesa paybill 888880 and third-party…
View more

Trump's Canada Tariff May Spike NY Energy Prices

25% Tariff on Canadian Imports threatens New York energy markets, disrupting hydroelectric power and natural…
View more

EU Plans To Double Electricity Use By 2050

European Green Deal Electrification accelerates decarbonization via renewables, electric vehicles, heat pumps, and clean industry,…
View more

Berlin urged to remove barriers to PV

Germany Solar Cap Removal would accelerate photovoltaics, storage, and renewables, replacing coal and nuclear during…
View more

More than Two-thirds of Americans Indicate Willingness to Give or Donate Part of their Income in Support of the Fight Against Climate Change

U.S. Climate Change Donation Survey reveals Americans' willingness to fund sustainability via government incentives, electrification,…
View more

UCP scraps electricity price cap, some will see $7 bill increase this month

Edmonton Electricity Rate Increase signals Alberta RRO changes as the UCP ends the NDP price…
View more

Sign Up for Electricity Forum’s Newsletter

Stay informed with our FREE Newsletter — get the latest news, breakthrough technologies, and expert insights, delivered straight to your inbox.

Electricity Today T&D Magazine Subscribe for FREE

Stay informed with the latest T&D policies and technologies.
  • Timely insights from industry experts
  • Practical solutions T&D engineers
  • Free access to every issue

Download the 2026 Electrical Training Catalog

Explore 50+ live, expert-led electrical training courses –

  • Interactive
  • Flexible
  • CEU-cerified