Intergeo has acquired a controlling stake in Russia's Far Eastern coking coal producer Kolmar, which has a total of 400 million tonnes of coking coal reserves of K, GZh and Zh grades in the south of the Yakutia territory.

Mr Maxim Finsky president of Intergeo said that it is a great acquisition which will allow us to diversify the portfolio of assets. The high quality coking coal is in good demand in the market right now and the upward pricing trend has only begun. The financial details of the deal have not been disclosed.

Kolmar was founded in 2004 to manage the coal mining facilities and the development of new projects for the development of South Yakutia coal deposits. One of its main investment projects, integrated development of South Yakutia includes Kolmar plan to build the coal complex Inaglinsky. Kolmar controls the operations of Erel open pit coal mine with a capacity of 450,000 tonnes per year of coal company Neryungriugol, which owns Denisovskaya mine with a 750,000 tonnes capacity and Dezhnevskaya mine, which holds the license to develop the coal deposit of the same name.

Intergeo does not have its own steelmaking facilities and so the mined coal will be sold. The location of Kolmar in the region close enough to the Asian markets guarantees it stable demand and lower transportation costs. However, according to market analysts, the project requires significant investment; to achieve profit at least after two years Intergeo must invest not less than USD 400 million to 500 million.

By 2012, Intergeo plans to become one of the largest coal companies in Russia, with total reserves of more than 700 million tonnes and with a volume of concentrate production of more than 8 million tonnes per year.

(Sourced from Kommersant)