ET reported that the Aditya Birla group is in negotiations with as many as six thermal coal mine companies in Australia, in its search for raw material assets to feed its USD 5 billion growth program in aluminum, said people familiar with the group's plans.

The Mumbai based conglomerate has never been so active in overseas markets, since it acquired Canada's Novelis in 2007. The move to adopt an aggressive stance to acquire coal mines in Australia may have been triggered after the conglomerate faced delays in coal linkages for its forthcoming aluminum Greenfield projects in Orissa and Madhya Pradesh which inflated project costs, said the people who are connected with the negotiations.

Thermal coal is crucial, as after bauxite, the mineral is the most vital cost item for making aluminum. The group also requires coal for its cement operations. A group spokesperson did not comment on the matter.

The Kumar Mangalam Birla led conglomerate has already expressed its intention to bid for a controlling stake in the USD 5 billion, Queensland-based New Hope Coal which is estimated to contain about 1 billion tonnes in coal reserves.

The company will be pitted against global majors including Xstrata in the race for New Hope. Apart from New Hope, the group is also in talks with five coal mining companies in Australia that have varying degrees of coal reserves from 200 million tonnes to about 1 billion tonnes of coal.

A source said that "They have shifted their focus from Indonesia after Indonesia tightened norms on export of coal. Australia is also close and they want to create sufficient reserves for their aluminum and cement operations.”

(Sourced from ET)