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Coal-fired Power Plants
We have partnered with VIP Group and Hoang Ngoc
Joint Stock Company to develop three to five coal-fired
power plants with total capacity up to 6,000 MW in Quang
Binh, Quang Tri, Khanh Hoa, and An Giang Provinces,
Vietnam. We will provide advanced technologies to equip
these plants and engage key investors with operational
history in the area of thermal electric plants to participate
in these projects. In addition, we will provide coal supplies
from our coal concessions in Indonesia to these power
plants through long-term off-take contracts. We plan to
retain an equity interest in these power plants.
Market and Competition
Energy demand growth According to the U.S.
Energy Information Administration, world marketed
energy consumption is projected to increase by 44% from
2006 to 2030. For coal consumption, annual world coal
demand is expected to grow from 7.6 billion tonnes in
2011 to 8.9 billion tonnes in 2016 and more than 85% of
global demand growth will come from China and India.
New coal-fueled generation of 395 GW is expected by
2016. In 2011, total global coal exports amounted to 1,040
million tonnes, of which Indonesia accounted for 319
million tonnes and Australia 281 million tonnes. Other
countries in Asia Pacific all need to import coal to generate
electricity. For example, by 2017, Vietnam will need to
import 24 mtpa and Malaysia 29.7 mtpa. Japan will shut
down 50 nuclear power plants by 2040 and will need to rely
on natural gas, coal and renewables to fill that gap.
Competition
Indonesia’s top six coal producers (Bumi, Adaro, Kideco,
Berau, Banpu, and PTBA) accounted for more than 75%
of Indonesia’s coal production between 2002 and 2009 and
are expected to increase production substantially over the
next decade. There are also numerous well-established
smaller ones. Our coal production in Indonesia is expected
to be less than 1% of the total annual Indonesia’s coal
production in each of the first two years.
Production Plan
For our coal business, we have established good
relationships with, and depending on each project,
will engage reputable mining consultants and
contractors such as Leighton, PAMA, Petrosea,
PT Thiess, PT Runge, and SRK Consulting, to
assist us in technical due diligence, feasibility
study, mine planning, and mine operation and
production. For our renewable energy businesses
and power plant developments, our industry
partners will manage the related technical and
operational aspects of each project.
Financial Plan
We will need to raise additional capital to
implement each stage of our business plan. We
have established a network of institutional
investors, strategic partners, investment bankers,
private equity funds and accredited individual
investors in the U.S., Europe and Asia that are
interested in investing in our company as well as
providing project financing, depending on each
particular project.
Company Guidance
The company revenue guidance for FY’s 2013 and
2014 are $1.85 million and $98.08 million with
projected profits of $838,140 and $17.62 million
respectively, based on our anticipated trading
activity, joint operations with local Indonesian
coal producers, and production of the two coal
concessions we are acquiring. From the third year
of mine operation onward, we expect to have
multiple producing mines and substantial increases
in total revenues and profits.
Risk Factors
• Early-stage enterprise
• Strength of the global economy;
• Demand for electricity;
• Global supply of thermal and metallurgical
coal;
• Political risks;
• Inflation risk;
• Financing and operational risks.
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