Altan San Securities - Mongolia Investment - Shenhua retains focus on mongolian coal mines

Shenhua retains focus on mongolian coal mines

China Shenhua Energy Co Ltd, the top Chinese coal miner, will not consider buying any major overseas mines before it starts operating the Watermark coal project in Australia. "We will not go for other projects if we have not succeeded in this one, the first step of our overseas efforts," Shenhua board secretary Huang Qing was quoted as saying by the Shanghai Securities News. "Shenhua will take an active and cautious approach (toward overseas buying)." Mr. Huang said Shenhua would focus on opportunities in Australia, Indonesia and Mongolia that could be potential suppliers to coal users on China's southeast coast.

He added that the company was also interested in coking coal resources in Mongolia. He downplayed concerns over the impact of rising coal imports on the domestic market, saying most of the coal was still supplied by domestic producers. China's major power companies stepped up coal imports this year as they failed to reach price agreements with domestic coal miners for annual supply contracts. Coal imports in April soared to a record high of 9.16 million tons, up 3.4 million tons from a month earlier and far above market expectations. Imports in the first four months surged 56 percent to 22.77 million tons.

Source: Montsame

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