REL, Tata Power looking at Indonesian coal company Bumi

The Economic Times reports that power sector majors Reliance Energy and Tata Power are looking at buying an equity stake in Bumi Resources, an Indonesian coal firm, to meet the fuel requirements for their power plants in India. International companies such as Mitsubishi Corporation, South Korean power company Kepco and a Glencore subsidiary have also shown interest in Bumi. Bumi Resources is Indonesia's largest coal producer and exporter with reserves of 52 mn tonnes, and has put a reserve price of $1 bn for around 30% stake. Acquiring coal mines would help the companies in assuring fuel supplies. Also, Indonesian coal has lower ash content and higher calorific value than Indian coal, resulting in higher power generation with less fuel.