JOHANNESBURG (miningweeekly.com) – Diversified mining group BHP Billiton has completed a strategic review of its Indonesian coal assets and announced on Tuesday that it would sell its 75% interest in IndoMet Coal to equity partner PT Alam Tri Abadi (Adaro).
The sale price is understood to be $120-million.
IndoCoal comprised seven coal contracts of work, one of which hosted the one-million-tonne-a-year Haju mine, which entered into production last year and achieved its first shipment in March 2016.
“After a detailed review of IndoMet Coal, we concluded that although the project could support a larger scale development, BHP Billiton has a range of other growth options in the portfolio that are more attractive for future investment,” said IndoMet Coal asset president James Palmer.
One of the company’s coal projects focused on latent wash plant capacity at Caval Ridge, in Queensland, which would add four-million tonnes a year to its capacity. CEO Andrew Mackenzie said last month that the incremental metallurgical coal tonnes at Caval Ridge would be “highly profitable” at current spot and consensus forecast prices.
BHP Billiton discovered the metallurgical coal resource in Central and Eastern Kalimantan, which the IndoMet Coal contracts of work covered, in the late 1990s. The seven contracts of work have a combined declared resource of 1.27-billion tonnes of metallurgical coal.
The company sold a 25% interest in the project to a subsidiary of PT Adaro Energy in 2010. The miner announced in April that it was conducting a strategic review of the long-term future options for its Indonesian coal interests.
Edited by: Creamer Media Reporter
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