NALCO eyes coal mines in Indonesia

By Arpan Mukherjee

MUMBAI (Reuters) - India's National Aluminium Co Ltd has shortlisted two to three coal mines in Indonesia's Sumatra Island to secure supplies for its proposed 750 megawatt power plant in Indonesia, its chairman said on Wednesday.

State-run NALCO, India's No. 2 aluminium producer, had signed an initial agreement with the Indonesian government in January to build a 500,000-tonne smelter in phases that would cost $3.4 billion.

"The sites have been identified... We are awaiting the feasibility report," C.R Pradhan told Reuters over telephone.

The report is expected in six months, he said.

The company, which is in the midst of 50-billion-rupee ($1.2 billion) expansion to be completed in December, plans to set up smelters in South Africa, Iran and Saudi Arabia.

Pradhan said NALCO had signed a preliminary agreement with Iran's Kerman Development Organisation for a joint venture that would build a smelter in Iran with an annual aluminium capacity of 250,000-500,000 tonnes. NALCO will own 51 percent in the venture.

NALCO is also in talks with India's Tata Group for a joint venture to build a $3 billion aluminium smelter in South Africa, he said.

The company recently invited bids for a feasibility study to build 50 megawatt wind power plants near its mines and plants that make the metal, using an energy-intensive process.