Sources: Anglo American to Sell Coal Assets in Australia
To sell or not to sell, that’s the mounting question for Anglo American. The miner is reportedly set to sell its stake in two coal mines in Australia, sources with knowledge of the matter said.
Anglo American has a total of six coal mines in Australia. The two mines being mulled are the Dawson and Foxleigh operations, both of which are situated in the country’s north-eastern Queensland state. The company has a 70 percent stake in Foxleigh, which produces roughly 2.5 million tons a year.
Jacqui Strambi, a spokeswoman for Anglo American in Brisbane, declined to comment on the sale of the Dawson and Foxleigh mines, but said the company is reviewing its coal assets.
“There is a review of the Australian coal assets but the outcome is yet to be determined,” Strambi told Bloomberg.
The move to sell is part of a company-wide coal shakeup which will also see the review of South African operations. Anglo American previously announced it would further reduce capital expenditure by $500-$800 million in 2014 and by up to $1 billion in 2015.
Last month, Anglo American sold its Callide and Dartbrook mines as part of its strategy to only invest in assets that can produce quality coal with low costs. The potential coal asset sale mirrors the decline in global coal prices, which are putting many mines into a loss-making position.
Anglo is also said to be preparing to divest five mines in Queensland and New South Wales as part of the $3 billion to $4 billion asset sale program.
Last month, the miner resubmitted a revised development proposal for the Drayton South thermal coal mine in Australia.
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