Thai coal miner eyes expansion into RI

Thai coal miner eyes expansion into RI

BANGKOK (Reuters): Thai coal miner Lanna Lignite Plc said on Friday it planned to diversify into other sources of energy because domestic coal reserves were likely to decline in the next few years.

Lanna Chief Executive Officer Visit Tantisunthorn told Reuters the company planned to invest about 500 million baht (US$11.1 million) this year looking for coal in Indonesia and on diversification projects.

"We plan to expand our business into other sources of energy, which we hope can yield growth of more than 20 percent because domestic (coal) reserves are likely to dry up in the next three years," Visit said in an interview.

Liquefied petroleum gas, biogas and gasohol -- a blend of gasoline and ethanol -- were all potential substitutes in the long term, he said.

Lanna is Thailand's second biggest coal miner with a market share of 24 percent. It will be renamed Lanna Resources Plc next month to reflect the change in its business strategy.

Lanna has interests in the power business with a 50 percent stake in small power producer Gulf Electric. Visit said the firm was likely to sell a stake in the power firm in the future but gave no further details.

Lanna shares were unchanged at 35.50 baht by 0930 GMT on Friday, compared with a 1.06 percent gain in the SET composite index.

Lanna has outperformed the market and the sector this year, gaining 18.3 percent compared with an eight percent gain for the energy sector index.

Visit said Lanna was negotiating with potential partners to secure coal reserves and expected to conclude a deal in the next few months aimed at becoming a regional energy provider.

Lanna's revenues now come almost wholly from coal but Visit said he expected the revenue contribution from coal to fall to about 60 percent in the next three years.

He said he expected sales revenues of one billion baht for 2001, up about eight percent from 923 million baht posted last year, as coal prices tag along with rising oil prices.

He said Lanna had a coal sales target of about 1.7 million tons this year, up from 1.35 million tons last year.