Page 9 - AsiaElec Week 25

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BHP Group in the market

to sell Australian mine

AUSTRALIA BHP Group could sell its Mount Arthur coal industry associations with policies that fail to
mine in Australia’s Hunter Valley region as min- match the company’s support for the 2015 Paris
ers face rising investor and regulatory pressure to Climate Accord.
cut their exposure to fossil fuels. Rival mining companies have also taken steps
BHP has hired Macquarie Bank and JP Mor- to go thermal coal-free, with Rio Tinto selling
gan to sell the Australian mine, Reuters reported. its last coal mines in 2018, and Anglo-American
The mine supplies coal to thermal power considering the spin-off or sale of its South Afri-
plants (TPPs) in Australia and overseas. The can coal operations within the next two or three
mine could be sold for less than $1bn, as the years.
value of coal assets has fallen in 2020, Reuters The Reuters report stated that a small group
added. of Australian miners, including Whitehaven
BHP said that its Australian coal business Coal, China’s Yancoal and India’s Adani Enter-
represented just 3% of its global portfolio, and prises, had expressed interest in the Mount
it said in February that it was looking to sell if a Arthur mine.
reasonable offer came along. Sales processes have slowed over the past few
Activist investor Elliott, which holds a 4.7% months, as government lockdowns to contain
stake in the mining company, has pushed for the the novel coronavirus (COVID-19) halted mine
sale of BHP’s thermal coal assets, which include visits and due diligence.
one-third of the Cerrejon mine in Colombia. But as lockdown measures are gradually
BHP has also been under pressure from by lifted, banking sources expect a sale for Mount
green groups and some shareholders to leave any Arthur could be possible by the end of the year.™

India to impose coal import ban

INDIA THE Indian government has brought in new vetted,” CIL said.
rules that aim to ban coal imports for the power The new rules will apply to India’s highly reg-
sector’s blended coal market. ulated power generation market.
State-owned Coal India Limited (CIL) has The rules will be enforced by the Central
been asked to sign new coal supply deals with Electricity Authority (CEA), which the govern-
power generation companies that will replace ment has asked to write to all power generation
imported coal with domestic supplies. companies requiring them to sign MoUs with
“Several initiatives are being taken for supply coal companies in a bid to ensure that more coal
of domestic coal as import substitution and the is supplied.
same has been deliberated in the meetings held Generating companies currently receive
on April 4 in Ministry of Coal....and in the Min- coal on terms set out in their existing fuel sup-
istry of Power chaired by Additional Secretary ply agreements (FSA), which sometimes do not
Power...,” CIL stated in a letter to its subsidiaries. meet all their coal requirements.
“It has been decided to bring the level of India’s coal sector is plagued by inefficiencies
import of coal for the purpose of blending by the and transport bottlenecks, meaning that coal is
domestic coal-based power plants to zero level in often left in stockpiles at mineheads or in rail
this fiscal,” it said. wagons, while power plants do not have enough
Import substitution has been a central policy fuel. This had until now forced many to turn to
of the Indian government as the country tried the import market to meet their demand.
to deal with falling demand for coal from power The new rules build on an advisory notice
generators as the coronavirus (COVID-19) pan- given by the Ministry of Power on April 28,
demic reduced demand for electricity. which asked generation companies to reduces
“It was also decided in the said meeting to tie coal imports and to replace them with domestic
up the long-term requirement of import substi- coal.
tution through [a memorandum of understand- The country imported 247.1mn tonnes
ing] MoU. Accordingly, [to cover] the supply of coal in 2019-20, about 5% more than the
of coal through import substitution, a model 235.35mn tonnes imported during 2018-19.™
MoU has been prepared, which has been legally

Week 25 24•June•2020 www. NEWSBASE .com P9