After buying ships to ferry coal to its cement plants spread across in South India, The India Cements Ltd (ICL), is heading to acquire coal mines itself. The mandate now is to buy mines in Indonesia. According to
sources, ICL has sought the services of a "coal facilitator" in Indonesia to shop for mines there. "We are getting a lot of offers, we are evaluating each. A decision would be taken soon," official sources said.
The reason to buy coal is simple: The company consumes some 0.9Mta of coal, (an important raw material for cement making). With the prices of coal in the markets touching the roof, ICL feels that that it could save considerably if it owns coal assets.
Coal which used to be available at $40 a tonne two years back is now costing $120 to $130 a tonne, this coupled with delays in coal availability for cement plants is the reason why ICL is looking for coal assets.
Besides, the coal which is being imported can be used to fire its captive power plants as well.
The budget for coal mines acquisition is not known as yet. A few days back it took possession of its second ship from Essar Shipping which has 38,002dwt while the first one with a capacity of 41,824dwt was purchased in January this year from Markbright Ltd of Cyprus. "We have bought two ships each having a capacity of 40,000 dead weight tonnage. With these we will save about $50 a tonne on cement which cost savings in coal movement," sources said.
After this, ICL would have total control over all its raw materials except gypsum.