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Boom-to-bust Australian coal baron acquires Anglo American mine

Published 29/12/2015, 01:40 pm
Boom-to-bust Australian coal baron acquires Anglo American mine
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SYDNEY, Dec 29 (Reuters) - Former Australian coal baron Nathan Tinkler has surfaced as a suitor for one of the first of many businesses Anglo American AAL.L is trying to offload as commodity markets deteriorate.

Anglo American has agreed to sell its 83.33 percent interest in the Dartbrook coal mine in the Australian state of Queensland to Australian Pacific Coal Ltd AQC.AX . The mine has been mothballed since 2006.

Tinkler, who rocketed up the rich list to become Australia's youngest billionaire by riding the mining boom before losing it all when coal prices collapsed, was appointed chief executive of Pacific Coal on Nov.2.

The one-time electrician last year attempted a comeback in mining but a deal to buy a mine from Peabody Energy BTU.N fell through when he failed to make a A$70 million closing payment.

In a statement, Tinkler said the low-sulphur type coal he plans to unearth at the Dartbrook mine can be done cheaply and fill growing demand for less polluting coal prized for blending with coal of higher sulphur content to reduce greenhouse gases.

Under the deal, Australian Pacific Coal will acquire Anglo American's interest for up to A$50 million ($36 million), starting with an up-front cash payment of A$25 million.

"We firmly believe in the resilient demand for high-energy low ash thermal coal, as concerns about greenhouse emissions increase," Tinkler said.

Anglo American, the world's fifth-biggest global miner by market value, announced plans to offload three-fifths of its operations and reduce its workforce to 50,000 from 135,000 now. urn:newsml:reuters.com:*:nL8N13X15H

The overhaul highlights the scale of the fallout from the commodities slide, which is forcing mining companies across the board to rethink job numbers and capital spending.

Thermal coal prices TRAPI2Yc1 have fallen by 80 percent since 2008 peak levels to below $45 per tonne.

But Tinkler is not alone in taking a counter-cyclical bet on coal.

New Hope Coal NHC.AX paid $606 million for a 40 percent stake in a mine near the Dartbrook lode held by Rio Tinto (L:RIO) RIO.AX . urn:newsml:reuters.com:*:nL3N11Z5R6.

And Stanmore Coal SMR.AX recently outlined plans to restart a mine it bought from Vale VALE5.SA and Sumitomo Corp 8053.T for $1. urn:newsml:reuters.com:*:nL3N1460A8 ($1 = 1.3787 Australian dollars)

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