Wesfarmers has confirmed that it is considering the sale of its Australian coal mines as part of an strategic evaluation of the assets.
Responding to media speculation regarding a potential sale, the company sais that was considering a “broad range of options, from operational to divestment initiatives, including recently seeking expressions of interest from external parties who may want to acquire the coal assets.”
The company owns two coal mines, Curragh in the Bowen Basin of Queensland and Bengalla in the Hunter Valley of New South Wales. Curragh produces metallurgical coal for export, as well as some thermal coal for domestic markets. Bengalla supplies thermal coal to the export market.
Bengalla is co-owned with New Hope Corp., which recently acquired a 40% stake in the mine from Rio Tinto, Taiwan Power and Mitsui & Co.
Prices for coal have soared this year as China cut domestic production, increasing its demand for imports. “I believe every owner of a coal asset in Australia would consider selling in the current environment,” Matthew Boyle of CRU told Bloomberg. “However, coal selling prices need to be at high levels for a prolonged period before this flows into coal producers’ books.”
Wesfarmers also added a note of caution, saying that there was “no certainty this process will lead to a transaction” and that it would update the market further “if and when appropriate”.
Read the article online at: https://www.worldcoal.com/coal/17112016/wesfarmers-looking-at-coal-mine-sale/
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