Rio Tinto has reached a binding agreement for the sale of its 50.1% interest in the Clermont Joint Venture to GS Coal, a company jointly owned by Glencore Xstrata and Sumitomo Corporation, for US$1.015bn. Under the terms of the sale, Glencore Xstrata will take over management of Clermont Mine, which produces thermal coal in central Queensland (Australia). The sale is also conditional upon certain conditions precedent, including the customary regulatory approvals. The transaction is expected to close in the first quarter of 2014.
The Clermont Mine, which delivered its first coal shipment in 2010, was discovered in 1978. When the mine reaches full capacity (expected from 2013) it will produce up to 12.2 Mt/year of thermal coal for international markets. The deposit holds 177 Mt of thermal coal, and the mine has an expected life of 17 years. Rio Tinto managed the operation on behalf of the joint venture partners: Rio Tinto (50.1%), Mitsubishi (31.4%), J-Power (15%) and J.C.D. (3.5%).