Photo by: Bloomberg
PERTH (miningweekly.com) – Reports emerged on Thursday that diversified miner Glencore has reached an agreement to purchase some of the Hunter Valley assets that ASX-listed Yancoal recently acquired from mining major Rio Tinto.
The reports, carried in several Australian news outlets, come as Yancoal holding company Yanzhou Coal reported late on Wednesday that its board had approved a resolution to transfer a 16.6% interest in the Hunter Valley operations to a third party, and to establish a joint venture to operate and manage coal mining assets related to these Australian operations.
While Glencore refused to comment on the reports, Yancoal on Thursday went into a trading halt flagging a “possible major transaction”. The trading halt is expected to remain in place until Monday.
Yancoal was named as the preferred bidder for Rio’s Australian Coal & Allied (C&A) unit in June, after increasing its offer to $2.69-billion, adding $240-million in unconditional guaranteed royalty payments to a previous cash offer of $2.45-billion.
The Yancoal offer was increased to rival a bid from Glencore, which had offered Rio $2.67-billion for the C&A assets, which includes a number of opencut thermal coal mines in the Hunter Valley.
C&A holds an 80% interest in the Mount Thorley mine, a 55.6% interest in the Warkworth mine, a 36.5% interest in Port Waratah Coal Services, as well as other undeveloped coal assets. The Hunter Valley and Mount Thorley Warkworth operations produced 25.9-million tonnes of saleable thermal coal and semi-soft coking coal in 2016.