Rio Tinto lets go of remaining Australian coal assets
Rio Tinto has completed the sale of its remaining Australian coal operations in Queensland for $US3.95 billion ($5.3 billion).
The transactions include the sale of Rio’s 82 per cent share in the Hail Creek coal mine and 71.2 per cent share in the Valeria coal project to Glencore, for a total of $US1.7 billion.
The mining giant has also sold 80 per cent of its interest in the Kestrel underground coal mineto Melbourne-based mining private equity fund EMR Capital and Indonesia’s coal miner Adaro Energy, for $US2.25 billion.
Both EMR Capital and Adaro will now jointly manage and operate the mine, forming the JV Kestrel Coal Resources.
Under the JV, EMR owns 52 per cent the interest, and Adaro the remaining 48 per cent.
The JV makes up 80 per cent of the Kestrel share formerly owned by Rio, while Mitsui Coal Australia retains its 20 per cent ownership of the mine.
Adaro chief executive Garibaldi Thohir said, “The acquisition of Kestrel is a significant milestone in our strategic expansion of metallurgical coal portfolio which started with Adaro MetCoal.
“Having these two world-class metallurgical coal assets under our Adaro Mining pillar is going to strengthen our foothold in the metallurgical coal market and sustain Adaro Energy’s growth over the longer term.”
The transactions follow Rio’s sale of its 75 per cent interest in the Winchester South undeveloped coal project in Queensland in March.
All these coal assets, including Winchester South, are in Queensland’s Bowen Basin.
Rio Tinto chief executive Jean-Sebastien Jacques said, “The sale of our remaining Australian coal assets delivers exceptional value to our shareholders.
“I would like to thank the many people across Rio Tinto and the communities in which they operate who have contributed to the coal business. I wish them continued success under new ownership.”
The sales made part of Rio’s decision to streamline its portfolio and focus on a targeted allocation of capital.
Rio yesterday allocated $197 million of preliminary funding to its first intelligent mine known as the Koodaideri iron ore project in the Pilbara region in Western Australia. The mine will utilise leading-edge technology including high level of automation and robotics.
Rio also remains on track to complete its long-delayed autonomous train project AutoHaul, which the company refers to as the “world’s largest robot”, by the end of the year.