PT Adaro Energy has signed a binding agreement with private equity firm, EMR Capital, to acquire 80% of Rio Tinto’s stake at Kestrel coking coal mine for total cash USD 2.25 Billion, Adaro Energy said in a statement to the Indonesia Stock Exchange, on Tuesday, March 27, 2018.
The Kestrel mine is located in the Bowen Basin, one of the world’s premier metallurgical coal region in Australia. In 2017, Kestrel produced 4.25 MnT of hard coking coal. It has 146 MnT of marketable reserve and resource stands at 214 MnT as at Dec’17.
EMR and Adaro will jointly manage and operate Kestrel.
Adaro Energy is one of Indonesia’s largest coal producers, mining more than 50 MnT of coal per year.
The company plans to produce between 54 MnT to 56 MnT this year. In 2017, the company’s production dropped by 2% to 51.79 MnT from 52.64 MnT in 2016.
Asian countries remained the main destination for Adaro’s coal in 2017, the company said on its website. Indonesia’s domestic market continued as the company’s main buyer, accounting for 20% of Adaro’s sales in 2017. Malaysia was Adaro’s largest export market in 2017, contributing 15% to the company’s 2017 sales. The neighboring Southeast Asian countries had a number of new coal-fired generation commissioned last year.
China and South Korea each accounted for 12% and 11% of Adaro’s sales, as both countries resorted to imports in order to fulfill increased domestic demand.
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