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BHP set to reap $7 billion for ‘cast-offs’ as buyers circle unwanted mines

BHP appears to be closing in on a big pay day for its unwanted coal assets including the two Queensland projects held by its BMC joint venture with Mitsui.

Jun 04, 2021, updated Jun 04, 2021
Some 4000 countries, states, regions, cities and companies globally have now committed to net-zero. (File image).

Some 4000 countries, states, regions, cities and companies globally have now committed to net-zero. (File image).

But how much the company will earn from a trade sale has widened significantly.

Speculation has been the assets will achieve a price tag of anywhere between $US2 billion ($2.6 billion) and $US7 billion ($9.14 billion) for the mines which also also included the Mt Arthur thermal coal mine in NSW.

Prices for thermal coal have increased significantly in recent weeks to about $US120 a tonne and premium hard coking coal is at $US163 a tonne.

Shaw and Partners had claimed the BMC assets in the Bowen Basin – South Walker Creek Mine and Poitrel Mine – could earn as much as $US3 billion and the total package could be worth $US7 billion.

BHP has been trying to sell its thermal coal mines for several years and last year included the lower grade coking coal assets with a two-year timeline.

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It has also been anticipated that BHP would opt for a spin-off of the assets into a separate company in much the same way as it offloaded South32.

UBS has previously speculated that an in-specie distribution of shares in the new company was the most likely outcome.

BHP today said it would not add to the speculation about the outcome of the process.

 

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