Tata Power on Wednesday said its subsidiary PT Kaltim Prima Coal (KPC) has been granted mining lease by the Indonesian government for 10 years. KPC is based out of Indonesia and Tata Power holds 30 per cent stake in it through its wholly-owned subsidiary Bhira Investments Pte Ltd.
"PT Kaltim Prima Coal (KPC) has been granted a Special Mining Business Permit (IUPK) by the Investment Minister / Head of the Indonesia Investment Coordinating Board Decree of the Investment Minister / Head of The Investment Coordinating Board, Indonesia," Tata Power said in a statement.
The lease is granted for an initial period of 10 years till December 31, 2031 and can be extended by the provisions of the applicable regulations. This extension confers certainty of the mining operations and supply of coal. These are strategic assets to Tata Power which also help in hedging imported coal price exposure for its generating assets, the company said. The renewal will also help to ensure a regular supply of coal for its thermal power plants, it added.
Speaking on the renewal of the mining business permit, Praveer Sinha, CEO & MD, Tata Power said, "We are thankful to the Indonesian Government for trusting PT KPC through the renewal of our special mining business permit for coal. This will ensure a robust coal supply chain for our imported coal-based thermal plants resulting in the generation of reliable power to meet India's energy demands
Apart from KPC, Tata Power, through its subsidiaries, holds a 26 per cent stake in PT Baramulti Suksessarana Tbk mines in Indonesia. It has also signed an agreement to sell its 30 per cent stake in PT Arutmin Indonesia and associated companies in coal trading and infrastructure.
Shares of Tata Power on Wednesday closed 1.12 per cent higher at Rs 229.50 apiece on the BSE.
