Rio Tinto Sells Kestrel Coal Mine in Australia

Rio Tinto has sold its 80% stake in the Kestrel underground coal mine in Queensland, Australia, for $2.25 billion to a consortium comprising private equity manager EMR Capital and PT Adaro Energy Tbk. Kestrel was Rio Tinto’s last remaining coal mine, following the divestments of Hail Creek and other undeveloped coal projects.

Subject to all regulatory approvals, completion is expected to occur in the second half of 2018. It will bring the total amount achieved from the recent divestments of Rio Tinto’s Queensland coal assets to $4.15 billion.

“The sale of Kestrel, together with the announced divestments of Hail Creek and our undeveloped coal projects, delivers exceptional value to our shareholders and will leave our portfolio stronger and more focused on delivering the highest returns through targeted allocation of capital,” said Rio Tinto Chief Executive J-S Jacques.

The Kestrel longwall mine, located in the Bowen Basin, 40 kilometers northeast of Emerald in central Queensland, Australia, produces high-quality coking and thermal coal products for export markets. In 2017, it produced 5.1 million metric tons (mt) of coal, comprising 4.25 million mt of hard coking coal and 840,000 mt of thermal coal. Rio Tinto reported marketable reserves for Kestrel of 146 million mt and mineral resources of 241 million mt.