Anglo American sells stake in Grosvenor mine for R2 billion
The diversified miner has consistently been offloading coal operations since 2014.
Anglo American said on Wednesday it had sold its minority stake in the Grosvenor coking coal mine in Australia for about $141 million (about R2.1 billion) to a consortium of Japanese companies.
The diversified miner, which has consistently been offloading coal operations since 2014, said its 12 percent interest has been acquired by a group that includes Nippon Steel Corp, Mitsui & Co, Nippon Steel Trading Corp, Shinsho Corp, and JFE Mineral Co.
The consortium already owned a 12 percent of Anglo’s next-door Moranbah North coal mine, which provides the processing infrastructure for Grosvenor, located in the Bowen Basin, central Queensland.
“The alignment of ownership interests across the Moranbah-Grosvenor operation is an important step forward as we unlock the considerable additional value that we see,” Seamus French, CEO of bulk commodities at Anglo American, said in the statement. Seamus said the move would facilitate the delivery of value creation opportunities, including expanding the existing plant and speeding up various processes.
While the company is moving away from thermal coal, metallurgical or coking coal appears to be one of its key commodities moving forward. Metallurgical coal is used to make coke, a source of pure carbon in the steel-making process.
Despite a slight production drop from 23-25 million tonnes to 22-24 million tonnes expected next year, Anglo recently increased its metallurgical coal guidance for 2022 to an estimated 26-28 million tonnes.
Top mining companies have been reducing or eliminating their exposure to coal on environmental grounds. Rio Tinto, the world’s second largest miner, fully exited the coal sector in March 2018, with the sale of its Kestrel coal mine in Australia to private equity manager EMR Capital and Indonesia’s Adaro Energy for $2.25 billion.