BHP Billiton (BHP) JV Plans To Divest Gregory Crinum Mine
Zacks Investment Research | Jun 01, 2018 04:12AM ET
BHP Billiton (LON:BLT) Limited’s (NYSE:BHP) joint-venture (JV) business with Mitsubishi Development Pty Ltd (Mitsubishi) — BHP Billiton Mitsubishi Alliance (BMA) — has signed an agreement to spin-off its Gregory Crinum Mine to Sojitz Corporation, for A$100 million. Share price of BHP Billiton was nearly flat at $49.78, post the divestiture news’ announcement on May 30, 2018.
Queensland’s hard coking coal mine — Gregory Crinum — is situated 60 km north east of Emerald, in the Bowen Basin. The site also includes the Gregory open cut mine, Crinum underground mine and certain undeveloped coal resources. Moreover, its on-site infrastructure includes administration facilities, maintenance workshops, and a preparation and coal handling plant.
In addition to the divestiture of this Queensland mine, BMA will be offering proper funding for restoration of remaining areas of commotion at the site, will all rehabilitation obligations being planned to be transferred to the buyer.
During closure for maintenance in January 2016, the mine could yield six million tons of hard coking coal. BMA is divesting the mine after assessing that its true value can be realized better by the new owner. In future, this facility is expected to provide additional employment opportunities in Emerald, and even offer extra taxes and royalties to the people of Queensland.
This divestiture is currently subject to customary regulatory consent and will take few months to accomplish.
Over the past month, BHP Billiton’s shares have rallied 6%, outperforming the 3.7% gain recorded by the Zacks Investment Research
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