JSW Energy to buy more coal assets in South Africa

Sources close to the development told ET Now that JSW Energy will pay Rs 25 crores to Osho for transferring the licence for a 25000 hectares land.

| Jun 09, 2010, 05.31 PM IST

MUMBAI: Sajjan Jindal’s JSW Energy is all set to have enough feedstock for it’s power plants in India. The company is close to signing a deal with Osho South Africa Coal Mining to buy a prospecting licence for coal in South Africa. Sources close to the development told ET Now that JSW Energy will pay Rs 25 crores to Osho for transferring the licence for a 25000 hectares land.

Prospecting licence will give JSW Energy the go-ahead to explore the coal reserves of the land parcel and do the feasibility study for which the company is expected to invest a few hundred crores, sources said.

During the study if JSW Energy discovers good quality coal and starts mining, JSW will pay a royalty of $0.25/tonne to Osho South Africa Coal Mining, according to the deal. In an e-mail response, JSW Energy spokesperson did not wish to comment on the news item.

JSW Energy is scouting around for thermal coal linkages across the world to secure fuel for his power plants. Their last acquisition was a majority stake in South African Coal Mining Holdings for $50 million this fiscal.

JSW Energy is currently setting up 8000 MW of power capacity in India for which the company is investing Rs 40,000 crores. JSW Energy aims to generate 11000 MW of power by the year 2015.

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