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Report: Suitors approach Rio Tinto for remaining Australian coal assets

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Report: Suitors approach Rio Tinto for remaining Australian coal assets

A few weeks after Rio Tinto agreed to sell some of its Australian coal operations for up to US$2.45 billion, the global mining giant has received approaches for its remaining coal mines in the country, people with knowledge of the matter told Bloomberg News.

On Jan. 24, the company struck a deal to sell its Australian subsidiary Coal & Allied Industries Ltd. to Yancoal Australia Ltd.

The company is now considering options for its stakes in the Hail Creek and Kestrel coking coal mines in Queensland, including a potential sale that could fetch up to US$1.5 billion, the news outlet wrote Feb. 2.

However, a formal sale process will not start until Anglo American Plc makes a final decision on whether to off-load its coking coal mines in Australia, the sources added.

Anglo is said to be reconsidering its plan to sell off two-thirds of its mines and lay off about half of its employees on the back of a rally in commodity prices in 2016.

The sale of Anglo's Australian metallurgical coal assets to a consortium led by Apollo Global Management LLC was called off in November 2016 after the miner's board voted down the deal that valued the Moranbah North and Grosvenor mines at more than US$2 billion.

Rio Tinto holds an 82% stake in Hail Creek and an 80% interest in Kestrel. Both operations produced a combined 10 million tonnes of coking coal and 4.6 million tonnes of thermal coal in 2016.