Malabar Coal says its decision to acquire Anglo American's controlling interest in the Drayton thermal coal mine is to reduce the environmental impact of their other operations.
The company believes that the existing infrastructure at the Drayton site will enhance efficiency at Malabar’s Spur Hill underground coking coal project, some 40 kilometres away.
Anglo American agreed to divest its 88.17% stake earlier this week, handing over the coal preparation plant, stockpiling facilities, a rail loop, as well as offices and workshops among other assets.
Malabar Coal chairman Wayne Seabrook said: “While this transaction delivers substantial efficiencies and environmental benefits for Malabar’s Spur Hill operation, there may also be an opportunity in future to develop an underground mine within EL 5460.
“But most importantly it will allow us to reduce the impact of its operations on the local community, neighbours and the environment.”
For Anglo American, the sale comes soon after it decided to divest its South African thermal coal operations to a Seriti Resources subsidiary for $166 million (US).
The company is battling rising debt levels and told investors at the AGM last month that it would be looking to quickly sell assets to reduce the net debt to manageable levels.
Anglo American CEO Mark Cutifani said: “The agreement to sell the Drayton thermal coal mine marks further progress as we focus our global portfolio around our largest and most competitive assets.”