South32, a global producer of premium-quality hard coking coal, has announced that it has agreed to sell its Illawarra Metallurgical Coal asset in Australia to GEAR M Illawarra Met Coal Pty Ltd, owned by Golden Energy and Resources Pte Ltd (GEAR) and M Resources Pty Ltd, for $1.65 billion in order to focus on investments in copper and zinc projects.
According to its statement, the company expects to complete the transaction in the first half of the financial year 2024-2025.
“It will streamline our portfolio, strengthen our balance sheet and unlock capital to invest in our high-quality development projects in copper and zinc. The transaction will also simplify our business and reduce our capital intensity,” South32 CEO Graham Kerr stated.
Illawarra Metallurgical Coal produces high-quality metallurgical coal for steelmaking. South32’s production guidance for the financial years 2023-2024 and 2024-2025 stands at 4.40 million mt and 4.70 million mt, respectively.