BHP Billiton New Mexico Coal has officially sold the San Juan Mine to Westmoreland Coal Company (WCC) – the oldest independent coal company in the US.
The WCC Board of Directors approved the purchase agreement on 23 June, 2015.
BHP said it expects to complete the transaction at the end of this year.
Once the transaction is finalised, WCC will assume full operation of the San Juan Mine from 1 January, 2016.
“We will continue to work closely with our employees and the communities we serve to ensure a smooth ownership transition to WCC,” said BHP Billiton New Mexico Coal President Pat Risner.
BHP announced the sale of San Juan in May. The mine is operated by San Juan Coal Company, a subsidiary of New Mexico Coal, which in turn is wholly owned by BHP Billiton.
Located 25 km west of Farmington, New Mexico, the mine produces close to 7 million short tons of coal annually and employs more than 450 people. San Juan is the sole supplier for the San Juan Generating Station, which employs another 350 people.
“The completion of this sale process, which will allow coal to be supplied to the San Juan Generating Station (SJGS) beyond 2017, is conditional on the Public Service Company of New Mexico (PNM) securing necessary approvals from the New Mexico Public Regulatory Commission (NMPRC),” BHP said in a news release.
The acquisition contemplates a coal supply agreement through June 30, 2022.
“Westmoreland intends to operate the San Juan Mine through the termination of the coal supply agreement and is hopeful an extension of the coal supply agreement can be reached that will extend the life of the mine far past the 2022 time frame,” WCC said in a media release.