Dubai-based traders Coal and Oil (C&O) is planning to build a coal fired power plant in Tamil Nadu, the southernmost state in India. C&O has also announced plans to purchase mines in India.
Earlier this month, C&O’s associate company, Coastal Energen, finalized US$800 million of financing primarily from the State Bank of India to build a 1,200 MW coal fired plant in Tuticorin. According to the company’s top official, the project is intended for a merchant power plant.
Founder and president of C&O, Ahmed Buhari, said, “This is the first power plant in India to get financing for a merchant plant model.
“Raising that level of financing for a merchant plant was not an easy thing to do in these times when credit is tough. But the banks were satisfied,” he added.
“C&O will no longer be just a trader but an integrated and diverse energy supplier. That's our strategy. It's no longer enough to merely trade coal,” he said. He also urged Indian coal traders to diversify into mining and power generation to succeed in an industry that has become increasingly competitive.
Since 1998, C&O has played a major role in India’s coal supply. The company sells over 6 million tons of imported coal annually and holds supply agreements with major producers in Australia, Indonesia and South Africa. C&O is privately owned with a 2008 turnover of US$500 million.
