Madhu Koneru

Innovative business in

Madhu koneru’s leadership in Mec coal

• Executive Vice Chairman of MEC Coal Pte Ltd. He leads pioneering investments in Indonesia. He serves as an Executive Vice Chairman and Executive Director of MEC Holdings, Ltd. He has been an Executive Director of TRIMEX International FZE since 1996. He served as a Director of TRIMEX Group and Al Ghanem Industrial Company, Kuwait.

• MEC has established MEC to develop one of the largest green field coal mines in Asia, located in East Kalimantan, Indonesia. MEC Coal, through its Indonesian subsidiary PT Tekno Orbit Persada, has thermal coal resources of Approx 1.5 – 2 billion metric tons with an upward potential of an additional 2 billion MT within the East Kutai regency of East Kalimantan province[http://en.wikipedia.org/wiki/East_Kalimantan_province].

• The current reserve is hosted in two adjoining coal blocks, which have the potential to produce 17 million metric tons per annum each during the first phase of productio Exploration license for the 5,000 hectares of land acquired.

MEC to develop $5.6b smelting project

• East Kutai regent Isran Noor said Wednesday that a Dubai-based company and an Indian aluminum producer had started the development of an aluminum smelter in Muara Wahau, East Kutai, East Kalimantan.In addition to the smelter, the two companies — Mineral, Energy, Commodities (MEC) Coal and National Aluminum Co. (Nalco) — would also set up a power plant with a total capacity of 1,400 megawatts and 142 kilometers of railway track connecting Muara Wahau and a port in Lubuk Tutung, Isran reported.

• “The total investment for the project reaches US$5.6 billion. They have started the development and we hope that by the end of 2012, the smelter can begin operating with a total capacity of 500,000 metric tons per year,” he told reporters after a discussion on coal mining in Jakarta.The smelter would be built near the coal mining site of PT Tekno Orbit Persada, a subsidiary of MEC Coal, in Muara Wahau, Isran said. The smelter was designed to process bauxite into aluminum, he added.

• He revealed that of 1,400 megawatts capacity of the planned power plant, 200 megawatts would be utilized for people living around the power plant. MEC said in a press statement available on its website that the projects would create around 5,000 jobs. The company also plans to build a fertilizer plant in East Kalimantan.

Indonesian authorities commenting MEC work

• “Other investors have realized the strengths of MEC’s business model and are now planning similar coal-railways in Sumatra and elsewhere in Kalimantan,” said Indonesian Minister for Transportation Freddy Numberi during the visit.

• “This new law is a breakthrough for the private sector, as the first private railway license issued to MEC will unlock opportunities for Indonesia. The Ministry of Transportation supports BKPM to meet its goal in bringing major investors to each province in Indonesia. The MEC project is a good example of a sound investment in railways in Indonesia,” said Ministry of Transportation Directorate General for Railway Tundjung Indrawan.

• “This is the second time I say to all investors to learn from Madhu Koneru, who has come to invest in Indonesia without demanding government support or guarantees. His achievements are based on his perseverance and conviction in the future of Indonesia,” said Bappenas Deputy for Infrastructure Deddy Priatna.

• “MEC’s experience in Indonesia has been positive from day one, and this can be attributed to the Government of Indonesia’s strong support for our project. At the central, regional and local levels, government officials understand the large economic spinoffs that will come from our project and it has meant that the government has delivered on its commitment to unblock investment bottlenecks,” said MEC’s Vice Chairman Madhu Koneru

Infrastructure Key for MEC’s Industry Investments in East Kalimantan

• MEC Holdings’ (MEC) integrated industrial facility in East Kalimantan is a first in Indonesia where infrastructure development is the key to the development of industrial clusters that unlock the value of Indonesia’s natural resources.

• “The project is closely aligned with the Government of Indonesia’s vision for utilizing Indonesia’s natural resources as the driver of industrial development and sustainable economic growth,” said Executive Vice Chairman of MEC Holdings, Madhu Koneru.

• Starting in mid-2010, MEC's will build Indonesia’s first private railway corridor. More than 130 km long, the railway will be the foundation for the development of an industrial cluster that is unique for Indonesia. It includes the construction of an aluminum smelter, fertilizer plant, power plant, mine, railway, and port terminal. More than 5,000 jobs will be created, and become an important driver of the economic development of East Kalimantan.

• “This project would not have been possible without the support of the Government of Indonesia. It immediately understood the value of our industrial cluster strategy and the benefits it will bring Indonesia and East Kalimantan, and from the beginning the government has been a partner for MEC in moving the project forward,” said Madhu Koneru.

MEC APPOINTS ENAM SECURITIES AS ITS INVESTMENT BANKER

• Madhu Koneru, Executive Vice Chairman, MEC said, “We see India as a key market for coal as the country continues to address its power requirements. MEC would like to be a part of the Indian growth story rather than just a supplier of coal”. MEC invests in and manages large-scale coal and related infrastructure projects in Indonesia. As of first quarter of 2008, MEC commenced development of its Coal mines in East Kalimantan situated on a 5000 hectare site, estimated coal resources of 2 billion mt and 800 Mt in measured reserves. MEC production and deliveries would begin with 2 million in 2010, 7 million in 2011 and 9 million in 2012.

• MEC has decided to adopt a partnership strategy for India wherein MEC is interested in working with Independent Power Producers (IPPs) by providing long- term assurance supply of Coal from its mines in Indonesia. This will create a win situation for power producers and us by creating a fully integrated power project.

• “We believe that ENAM Securities has strong capabilities and knowledge of the Indian Power sector and will be a great asset for us in finalizing a partnership strategy with some of the top Independent Power Producers of India.”, added Madhu Koneru.

• Vallabh Bhanshali, Chairman, ENAM Securities said, “ENAM has been involved in charting out growth strategies for various companies in the Indian power sector. As MEC’s advisor, ENAM will be able to bring together its strong research & Investment banking capabilities in order to create value for both MEC and Independent Power Producers.”

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Mec to buy Indian plants

• United Arab Emirates’ Middle East Coal (MEC) plans to buy stakes in India’s power plants in exchange for long-term coal supply. “India has one of the fastest growing economies but also has a shortage of power supply so we have decided to go ahead with these deals,” MEC vice chairman Madhu Koneru said.

• “We are close to signing contracts with a number of Indian power plants which need coal over the coming 15 years,” he said.

• MEC, a joint venture of UAE-based RAK Minerals and Metals Investments (RMMI) and mining company Trimex, was set up last year to oversee large scale coal-related infrastructure projects in Indonesia. In March this year RMMI received a license to build a 150 km rail line to carry coal in Indonesia’s East Kalimantan province. The project is estimated to cost US$1B.

• company is expected to provide US$100M of the initial US$600M investment. About US$500M will come from World Bank, other institutions and other partners.

• MEC plans to start shipping 3-5 mtpa of thermal coal by road. Volumes would rise to 17 mt when the rail line is completed in 2012.