Tata Steel buys additional 7% stake in Riversdale Mining, Australia

Tata Steel acquires 7.3% in Aussie firm.

Tata Steel has picked up a 7.29 per cent stake in Australia-based Riversdale Mining through Tata Steel Global Minerals Holdings, an indirect subsidiary of the steel major.
Tata Steel already has a relationship with Riversdale Mining. Sources close to the development said, Riversdale was a growing company and the investment made sense for Tata Steel. Last year, the steel major acquired a 35 per cent interest in two of Riversdale’s key Mozambique tenements, including the Benga licence, as well as offtake rights for 40 per cent of coking coal produced on commercial terms.

Total coal resource in the Benga licence in the Tete province has increased to 2.1 billion tonnes since April. The potential products include both hard coking coal and thermal coal. Tata Steel had earlier said that it would supply hard coking coal from the project to its Corus facilities in the UK and Europe and also to the company’s enhanced requirement in India in future.

Tata Steel’s capacity in India stands at seven million tonnes while Tata Steel group’s capacity is 30 million tonnes.

Raw material security has become imperative given the surge in prices. Coking coal contracts sealed at $94 per tonne increased to more than $300 per tonne this year. Tata Steel’s Indian operations meet 70 per cent of its coking coal requirement through captive mines. Tata Steel has two collieries in West Bokaro and Jharia in Jharkhand.