Jakarta-Coal India, the largest coal mining company in the world, is in advanced talks to buy up to 40% of Indonesian coal producer Golden Energy Mines up to $ 1 billion.

Three sources who know directly the deal told Reuters. "The process of due diligence has been going on for some time and will soon be finished and we are planning to bid at the end of next month," the Reuters source said.

Officials in India Coal Mines and Energy Golden partner, Diane Swastatika in Jakarta, could not be reached for comment. Golden Energy Mines intends to increase production to 10 million metric tons per year to 4.200 to 5.300 kc / kg coal this year from 3 million in Sumatra and Kalimantan mining companies.

Indian companies have been rushing to search for coal mining assets in Indonesia, South Africa and Australia to fill the growing gap between domestic output and demand of coal.

"All media is good for high-quality coal reserves in Indonesia, owned by existing players. What is left is the sub-bituminous coal reserves or low values ​​in the middle of Borneo or region where it is not economical to mine," said a source at one of mine Indonesia's largest.

"Many reserves are very far from the river to barge or road for the trucks to the port that the costs do not work for low-quality coal," he said.

The Indonesian government said last month that Coal India will invest up to $ 3 billion in the mining sector, steel, and ports in Kalimantan, without giving details.

Diane Swastatika Sentosa is owned by Sinar Mas Group, one of the leading conglomerates in Indonesia are controlled by the Widjaja family. This group has interests in pulp and paper, palm oil, banking and energy with operations from China to Africa.