GVK seeks more Asian interest in Galilee

INDIAN giant GVK will invite Asian investors to participate in its $A10 billion Galilee Basin coal development in Queensland to help fund its share of the costs.
GVK seeks more Asian interest in Galilee GVK seeks more Asian interest in Galilee GVK seeks more Asian interest in Galilee GVK seeks more Asian interest in Galilee GVK seeks more Asian interest in Galilee

Billionaire and Hancock Coal chairman Gina Rinehart.

Lou Caruana

GVK, which recently acquired a 79% stake from Gina Rinehart’s Hancock Coal, was prompted to sell stakes in the Alpha projects after finding it difficult to raise debt funding in the current market.

''European and US banks have shut up shop,” vice-chairman of GVK Power & Infrastructure Sanjay Reddy is reported as saying in the SMH. ''We have had to be a lot more conscious of financial requirements.''

The Indian group is reportedly making 28% of the total project available for around $US1.25 billion and is also planning to sell up to 49% of the project's rail and port infrastructure.

The Galilee Basin is emerging as a centre of Asian investment in Australian coal, with the Indian Adani group developing the Carmichael project and Clive Palmer’s China First project being bankrolled by the Chinese.

GVK acquired a 79% stake in Hancock’s flagship Alpha and Alpha West projects, 100% of Hancock’s nearby Kevin’s Corner project and all of Hancock’s associated rail and port commitments in September.

GVK said the three coal projects were expected to supply a total of 84 million tonnes per annum, with first exports of 30Mtpa due to start in 2014.

The projects are all planned to export through Abbot Point and GVK said it would retain some port capacity there for Hancock Coal, which will still have a 21% share in the Alpha and Alpha West projects.

While Hancock’s Alpha and Alpha West projects, also known as the Tad’s Corner and Paul’s Corner projects, are based on open cut mining, the Kevin’s Corner project is based on three longwall operations and one open cut.

According to Hancock’s earlier development timelines, the first longwall for Kevin’s corner aims to produce 4.4Mt of thermal coal in 2015, with a further expansion to 13Mt in 2016, 16.1Mt in 2017, 22Mt in 2018, 36.5Mt in 2019 and 28.3Mt in 2020.

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