South Africa’s Exxaro Resources is weighing its options for its Australian coal joint venture project with Anglo American Plc following the mining giant’s planned exit from the business, an executive said on Tuesday.
The South African coal miner and Anglo equally own the Moranbah South metallurgical coal project in Queensland. On May 14, Anglo announced plans to spin off or sell its coal, nickel, diamond and platinum businesses to focus mainly on energy transition metal copper.
While Exxaro is not currently evaluating any of the assets to be put up for sale by Anglo, it was assessing the joint venture project, chief growth officer Richard Lilleike said during a pre-close call.
“We will review our options under the Moranbah South joint venture agreement as and when any offers are made,” Lilleike said.
Asked if Exxaro has pre-emptive rights over Moranbah, Exxaro CFO Riaan Koppeschaar said the company was currently reviewing the joint venture agreement.
“It’s premature for us to disclose whatever rights we have,” Koppeschaar said.
In 2017, Exxaro moved to sell its stake in the project but failed to get attractive bids and began reassessing the potential development plan for the project in 2018 as coal prices soared.
Exxaro, which is pursuing plans to diversify away from coal into clean energy metals, especially copper, was taking the currently elevated prices for the metal into consideration.
“Copper remains fundamental to us as well as many other mining companies. But we will certainly take into account pricing when we look at these opportunities,” Lilleike said.
“In terms of what we can do to mitigate that, we are exploring partnership opportunities as well as looking at investments through the cycle of the commodity and what is the appropriate stage to enter.”
(Reporting by Nelson Banya; Editing by Chizu Nomiyama)
