Itochu coal department general manager Hiroshi Akiba said in a recent Tokyo interview the company wanted to double its coal assets by 2015, according to Bloomberg. He did not disclose the size of the investment or the specific sites being evaluated.
Itochu seeks to secure thermal and steelmaking supply from Russia, Canada and Indonesia, and told the news service that the Fukushima incident may accelerate demand from Europe as well as Japan as many searched for an alternative to nuclear energy.
"Our presence is still very small in the global coal trade," Akiba said late last week.
"We will spend more on mines if and when we identify good projects to invest in."
Late last month, American producer Drummond announced Itochu had bought a 20% stake in its Colombian operations for $US1.5 billion.
Drummond’s new South American arm, Drummond International, will be owned 80% by Drummond and 20% by Itochu. Both will oversee mining operations in the country as well as transportation infrastructure – both of which have been wholly owned by Drummond.
“[Itochu’s] investment in Drummond International will help finance Drummond's portion of its ongoing capital program in Colombia, which is focused on increasing coal exports in an environmentally sensitive manner,” Drummond officials said at the time, noting that the transaction was tied to a capital program in Colombia that could reach $1.3 billion over the next five years.
“The relationship between Drummond and Itochu dates back to the 1960s, when Drummond exported US metallurgical coal to Japan through Ataka, a trading firm that at one time owned an interest in a Drummond affiliate and which was subsequently bought by Itochu,” Drummond said.
“In the intervening time, Drummond and Itochu have continued to work together marketing coal internationally.”
Drummond said in June that it would continue to seek joint investment opportunities as well as other alliances with Itochu.
Akiba reportedly told Bloomberg that the investment in Colombia will earn Itochu “well over 10 billion yen ($US126.4 million)” in profits post-tax as soon as 2012 as output from the mines is set to jump 40% from last year to 35Mt in 2014.
Itochu also said in May that it intends to spend another ¥800 billion ($US10.1 billion) over two years for expansions in China, Australia and Brazil.
