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JOHANNESBURG (miningweekly.com) - Diversified miner Xstrata has confirmed that it is conducting a "strategic review" of its coal operations in South Africa's Mpumalanga province.
This comes as market speculation did the rounds on Monday that the Swiss-based miner was planning to sell its highest-cost thermal coal mines in South Africa.
Xstrata communications manager James Rickards told Mining Weekly Online that the company was conducting a review of its Mpumalanga complex, comprising the Spitzkop and Tselentis collieries near the town of Breyten.
Rickards said that Xstrata was considering "all options" and declined to give further detail, saying that the company had only started the process.
Reuters reported on Monday that according to industry sources familiar with the issue and prospective Indian buyers Xstrata would put its South African Spitskop and Tselentis coal mines up for sale later this year.
Spitskop and Tselentis are two of Xstrata's oldest and highest-cost thermal coal mines in South Africa and disposal would simply be optimising the company's coal portfolio, the sources said.
According to Xstrata's website, about 80% of the coal produced at Spitzkop is exported to Europe for power generation and the balance is sold on the inland market. Tselentis Colliery's product is also destined for export markets.
