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Rio Tinto agrees sale of interest in Clermont mine

World Coal,

Rio Tinto has reached an agreement for the sale of its 50.1% interest in the Clermont joint venture mine to GS Coal Pty Ltd, a company jointly owned by Glencore Xstrata and Sumitomo Corporation, for US$ 1.015 billion.

Under the terms of the agreement, Glencore Xstrata will take over management of Clermont mine, which produces thermal coal in central Queensland, Australia.

Rio Tinto chief financial officer, Chris Lynch, commented: “The sale of Clermont mine will allow us to realise value for our shareholders as we continue optimising our portfolio. It also demonstrates our focus on strengthening our balance sheet and taking a disciplined approach to allocating capital across the group.

“Rio Tinto remains committed to a long-term future in central Queensland. Production has recently commenced from the US$ 2 billion extension of the Kestrel Mine and studies are currently underway to extend production from the Hail Creek Mine. We expect Clermont Mine will continue to perform strongly under its new ownership and make an ongoing contribution as a member of the local community. We will maintain high safety and environmental standards at Clermont Mine, through the transition period to the new manager.”

Following the sale of Clermont mine, Rio Tinto will have completed US$ 2.915 billion of divestments this year. The transaction is expected to close in the first quarter of 2014.

Adapted from press release by Katie Woodward

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