{"id":3074,"date":"2013-09-23T09:42:44","date_gmt":"2013-09-23T09:42:44","guid":{"rendered":"https:\/\/www.greenpeace.org\/india\/?p=3074"},"modified":"2021-12-01T12:39:47","modified_gmt":"2021-12-01T12:39:47","slug":"coal-india-hiding-the-truth-about-reserves-from-investors","status":"publish","type":"post","link":"https:\/\/www.greenpeace.org\/india\/en\/press\/3074\/coal-india-hiding-the-truth-about-reserves-from-investors\/","title":{"rendered":"Coal India Hiding the Truth about Reserves from Investors"},"content":{"rendered":"
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Mumbai, September 23, 2013: Research by Greenpeace has found that the world\u2019s largest coal producer, Coal India Limited, is misleading potential shareholders by concealing the true level of its extractable reserves, as it prepares to sell additional shares to international investors.<\/strong><\/div>\n<\/div>\n
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According to the analysis \u201cCoal India: Running on Empty?\u201d(1) the company has failed to disclose to stock exchanges an internal assessment that shows its extractable coal reserves are 16% less than stated at the time of its 2010 listing – a violation of Indian stock exchange rules. Coal India continues to claim via its website that it has 21.7 billion tonnes of extractable coal reserves, yet a review of its own internal documents undertaken by Greenpeace and the Institute for Energy Economics and Financial Analysis (IEEFA) has shown that the company has only 18.2 billion tonnes of extractable coal, as per the United Nations reserve classification system (2). At targeted production rates, these reserves could be exhausted in 17 years.<\/p>\n

Greenpeace India has filed an official complaint with the Indian Stock Exchange regulator against Coal India for concealing material evidence on the scale of their coal reserves, in contravention of the terms of the Listing Agreement under the Indian Securities Contracts Regulations Act, 1956.<\/p>\n

Commenting on the findings, Ashish Fernandes of Greenpeace said: \u201cCoal India is trying to deceive its present and future shareholders by hiding the fact that its extractable reserves are almost a fifth less than it claims. Coal India has a legal duty to tell the truth and they are failing to do that.\u201d<\/p>\n

Supreme Court Advocate Shaunak Kashyap said, \u201cCoal India is in violation of statutory provisions particularly the SEBI Act, the Listing Agreement under the Securities Contracts Regulations Act, 1956, and SEBI\u2019s April 3, 2006 circular relating to disclosure of material events. It is a matter of grave concern that a government controlled company has failed to notify the exchanges of this reduction in their reserves, something that has serious implications for both investors and the country at large.\u201d<\/p>\n

The company has contracted four of the world\u2019s largest banks, Bank of America, Deutsche Bank, Goldman Sachs and Credit Suisse, to push its new share offer on the international stage, despite unions threatening to strike if the sale goes ahead, and with the company share price dropping in recent weeks.<\/p>\n

In light of this evidence, these banks have a moral and legal responsibility to ensure that material facts relating to the company\u2019s reserves are disclosed to investors.<\/p>\n

The new data about Coal India\u2019s reserves also casts doubt on the government\u2019s ability to sustain its planned investment in coal-fired power plants. Coal India currently supplies 80% of the country\u2019s coal and India has plans to add over 100,000 MW of new coal by 2017, even though the company is struggling to supply existing power plants. As a result, spiraling coal imports have played a role in India\u2019s ballooning Current Account Deficit and led to higher power tariffs.<\/p>\n

Notes to Editors:<\/strong><\/p>\n

1. Report available at http:\/\/www.greenpeace.org\/india\/Global\/india\/report\/2013\/Coal-India-Running-on-Empty.pdf<\/a><\/p>\n

2. The 21.7 billion tonnes is under the archaic Indian Standard Procedure system, while the 18.2 billion tonnes is under the internationally recognized UNFC system. The government of India had taken a decision in 2001 to switch to the UNFC system \u2013 a decision that has yet to be fully complied with by Coal India.<\/p>\n<\/div>\n\t\t\t\n\t\t\t<\/a>\n\t\t\t\t\t\t\t\n \t\t\t

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Mumbai, September 23, 2013: Research by Greenpeace has found that the world\u2019s largest coal producer, Coal India Limited, is misleading potential shareholders by concealing the true level of its extractable…<\/p>\n","protected":false},"author":46,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ep_exclude_from_search":false,"p4_og_title":"","p4_og_description":"","p4_og_image":"","p4_og_image_id":"","p4_seo_canonical_url":"","p4_campaign_name":"","p4_local_project":"","p4_basket_name":"","p4_department":"","footnotes":""},"categories":[44],"tags":[],"p4-page-type":[14],"class_list":["post-3074","post","type-post","status-publish","format-standard","hentry","category-greenpeace","p4-page-type-press"],"_links":{"self":[{"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/posts\/3074","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/users\/46"}],"replies":[{"embeddable":true,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/comments?post=3074"}],"version-history":[{"count":4,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/posts\/3074\/revisions"}],"predecessor-version":[{"id":12488,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/posts\/3074\/revisions\/12488"}],"wp:attachment":[{"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/media?parent=3074"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/categories?post=3074"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/tags?post=3074"},{"taxonomy":"p4-page-type","embeddable":true,"href":"https:\/\/www.greenpeace.org\/india\/en\/wp-json\/wp\/v2\/p4-page-type?post=3074"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}