Coal Asia bent to pursue coal exploration in DavOr-A A +A
Friday, October 26, 2012
TITAN Mining and Energy Corp. is pursuing its coal exploration and mine development activities in Davao Oriental and Zamboanga Sibugay, especially that its holding company, the Coal Asia Holdings, Inc. successfully listed its shares with the Philippine Stock Exchange (PSE) on Tuesday.
Oversubscribed some three times over, Coal Asia, the second largest local coal producer with the potential to become the biggest producer of high-grade bituminous coal, raised some P800 million from its initial public offering (IPO), which will be utilized to increase the company's capital.
The net proceeds from the IPO are also earmarked to bring its Davao Oriental mine into production by 2014 and its Zamboanga Sibugay mine by 2015.
With some P4 billion in market capital after this listing, Coal Asia's equity build-up will correspondingly enable its subsidiary, Titan Mining to complete its exploration and mine development activities in the Mindanao area, particularly in Davao Oriental and Zamboanga Sibugay, in a bid to supply enough coal for the expected explosion in demand by large scale energy producers racing to establish their coal-fired energy generating plants.
Increased coal production is also expected to address demand by cement plants that are also preparing for the impending growth of Mindanao through the government's plan to establish key economic zones on the island.
As one of the few major coal mining players in the area, Coal Asia has established a key position by initiating discussions with the Department of Energy and other power companies that plan to expand operations for long-term supply agreements. Positive talks with large power producers and cement manufacturers have been initiated.
Coal Asia chair Harald Tomintz said the decision to go public affirmed the company's commitment to the progression of the local coal mining industry and the bridging of the gap of the local energy sector.
"Aside from Coal Asia plans in developing the local coal mining industry to be self-sufficient, the company would like to solidify its commitment to be a serious player in the local energy sector, particularly in alleviating the power shortage in Mindanao, the very center of all our operations," Tomintz said.
In addition to the power generation sector, Coal Asia can also supply steam-grade coal to country's cement plants, canneries, and manufacturing plants that have converted their diesel-powered plants into coal-powered plants to mitigate costs.
The company has already bagged off-take contracts both here and abroad but is also eyeing the export markets including India, Japan, Taiwan, Hong Kong and Vietnam.
Published in the Sun.Star Davao newspaper on October 26, 2012.