Armand Hammer, China Sign Coal Production Loan
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PEKING — China and U.S. oil magnate Armand Hammer signed the country’s biggest-ever syndicated loan today, aimed at more than doubling China’s exports of coal, and Hammer said coal prices will certainly increase.
Hammer’s Occidental Petroleum Co. and a Bank of China subsidiary signed the $475-million loan to finance China’s largest coal mine, which the joint venture financed by 40 banks is developing in Shanxi province.
“There is not enough oil in the world,” Hammer told reporters. “There is only one substitute--coal. Coal prices will start rising in 1988 and will rise sharply by 1990.”
Hammer said production should begin on schedule next September, with output of more than 13 million tons of coal, 90% of it for export, more than all China’s current coal exports.
Exports last year were under 8 million tons and are planned to rise to 30 million by 1990.
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