Titan's Coal Asia Eyes IPO This Year

Coal Asia Holdings, holder of the country's second-largest coal reserves and with the potential to become the biggest producer of high-grade bituminous coal, filed Monday an application with the Securities and Exchange Commission to conduct an initial public offering in the fourth quarter of 2012.

The company plans to list its shares on the Philippine Stock Exchange's first board.

Coal Asia Holdings is the parent company of Titan Mining and Energy Corp., which owns mining exploration and development rights in Davao Oriental and Zamboanga Sibugay, is expected to boost market confidence in energy stocks amid the rising demand for coal fuel in the domestic and foreign power-generating sectors.

Company sources said mine developments were on-track with commercial production of 600,000 metric tons of high grade coal a year scheduled 2014.

Sources said a June 2012 study on its Davao Oriental mining prospect from Old Macopa to Batinan concluded the economic viability of the area with coal reserves of 28,000 metric tons per hectare, translating into an estimated market value of P23.8 billion.

An earlier Philippine Mineral Reporting Code standard geological report, done in April 2012, on contracts 159, 166 and 167 in Davao Oriental and Zamboanga Sibugay identified total potential coal resource of 120 million metric tons.

Company sources said an independent valuation report prepared by Multinational Investment Bancorporation valued Titan's coal assets at P12.5 billion.

Coal Asia has bagged off-take contracts here and abroad and is looking at export markets, including India, Japan, Taiwan, Hong Kong and Vietnam.

Officials are also confident the higher grade coal sources in Mindanao would timely address the increasing demand from large-scale energy producers and cement plants operating on the island.

The government plans to establish key economic zones on the island, raising energy demand from the island.