Anglo American to divest stakes in two Australian coal mines

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Image credit: www.angloamerican.com

Anglo American is planning to divest its stakes in two Australian coal operations in Queensland’s Bowen Basin, the Sydney Moring Herald has reported.

Image credit: www.angloamerican.com
Image credit: www.angloamerican.com

The move will see Anglo American sell its 51% stake in Dawson mine near Moura and 70% stake in Foxleigh mine near Middlemount as the giant miner continues the trend of cost cutting and asset sales in 2015.

The company – which previously announced the sale of Callide mine in Queensland and Dartbrook mine in New South Wales – said that the two coal operations in Queensland did not align with its core business portfolio in Australia and its broader coal business.

According to Mining Technology, with these divestments, the company expects its total sale portfolio to be 12.2 million tonnes (Mt) of export production and 8.4Mt of domestic production a year, and a combined resource base of more than two billion tonnes.

Adertisement

Anglo posted another yearly net loss of $US2.51 billion loss on Friday, mainly due to the $US3.9 billion writedown on its Brazilian iron ore operations, but also because of the slow performances of its Australian coal and manganese assets and the $US1 million loss of its Canadian coal operations.

The company already reduced staff in its Australian and South African coal units by about 350 in recent years, and said that more cuts were likely to happen this year.

“We’ve started that. We’re continuing on and the program will continue through the year in terms of reductions,” Anglo chief executive Mark Cutifani said.

“In our view, the markets will probably remain very tough for the next one year to two years. If I could say in a very sombre way, it’s a tough market in terms of the work we have done. We have positioned ourselves to continue to improve, but I would say there’s still a lot more to be done.”

However, Mr Cutifani said that the company was also investing in Australia, having already injected $US1.7 billion in the development of Grosvenor coking coal mine in the Bowen Basin, which according to him was on budget and on schedule to deliver first production in 2016.

“While it is a tough market in metallurgical coal, we’ve got two of, let’s say, the top five longwall operations (in Australia),” he said, referring to Grosvenor and the Grasstree mines.

“We expect Grosvenor to be right up the top of the performance curve and certainly a very low-cost operation.”