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UPDATE 2-Mercuria invests in Colombia coal, commodity trade

Published 08/18/2010, 10:10 AM
Updated 08/18/2010, 10:12 AM
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* Swiss trader opens Bogota trading office, buys barges

* Says optimistic about Colombia's future in commodities

(Adds details on Mercuria and Colombia's commodities sector)

By Laura MacInnis

GENEVA, Aug 18 (Reuters) - Mercuria, one of the world's largest private energy traders, said on Wednesday it had opened a trading office in Bogota and purchased a Colombian river barge business to transport coal and other commodities.

"This is a very important entry point for us into the Colombian market," Juan Houlin, head of Mercuria Coal, said in a rare statement from the Geneva-based company.

"We are very optimistic about the future of Colombia and see it as an important country for our company now and especially in the coming years across all our commodity products," he said.

Mercuria, which traded nearly 1.2 million barrels per day of crude oil last year, is the fifth-biggest independent energy trader and deals in a range of goods including natural gas, biodiesel and carbon emissions.

Chief Executive Marco Dunand told the Reuters Energy Summit in May that the Geneva-based company was looking at boosting its presence in coal as it further develops its upstream operations, infrastructure and trading desks.

Colombia, the world's No. 5 coal exporter, is attractive to coal shippers because it can export cargoes across the Pacific to Asia or across the Atlantic to Europe.

The main exporters of thermal coal from Colombia are the privately held companies Drummond and Glencore, plus Cerrejon Coal Company, a joint venture owned by BHP Billiton, Anglo American and Xstrata.

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Houlin said Mercuria's newly acquired barges, purchased for an undisclosed sum from the Colombian company Argos, would ship coal and other commodities along the river Magdalena, which would be leveraged across the company's trading business.

At present, most Colombian coal is moved by rail to ports for shipment.

Newly inaugurated President Juan Manuel Santos has said he plans to expand the railroad services connecting the country's coal areas to ports and invest in infrastructure that could help exporters of a range of goods.

Colombia is the world's No. 3 coffee exporter and is the top producer of high-quality Arabica beans. It also produces nickel and gold and has natural gas reserves estimated at nearly 4 trillion cubic feet.

Once seen as a failing state mired in cocaine violence, the Andean nation has seen a boom in foreign investment as a result of investor-friendly policies and a crackdown on guerrilla violence, which Santos has vowed to continue.

Colombia is widely expected to soon regain its investment credit grade rating. (Editing by Sue Thomas and Jane Baird)

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