Sanjeev Gupta's GFG Alliance snaps up Australian coking coal mine from Glencore

 
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Coking coal is used in steelmaking (Source: Getty)

Industrialist Sanjeev Gupta's GFG Alliance has agreed to buy Glencore's Tahmoor coking coal mine in Australia for an undisclosed sum.

The move follows the British firm's acquisition of the Whyalla steelworks in southern Australia last year.

The Tahmoor mine is expected to help optimise and expand production at Whyalla, securing its long-term sustainability. It produces around 2m tonnes of coal per year, the bulk of which is high-quality coking coal used for steel making.

“The acquisition of the Tahmoor mine is an exciting step forward in our stated strategy to create fully-integrated, end-to-end businesses in Australia, from raw materials and energy right through to high-value finished products ready for market," Gupta said.

“Through this purchase we secure and de-risk an important feed for the Whyalla steelworks. This, together with our iron ore mines in South Australia, now makes GFG the only fully-integrated Australian steel producer."

While GFG did not say how much it paid for the mine, Reuters reported it was likely to fetch around $100m (£73.8m). Tahmoor is one of two Australian mines Glencore put up for sale last year as it consolidates its coal activities.

The deal is set to be completed in the first quarter of 2018.

Jay Hambro, the boss of GFG's mining arm, Simec Mining, said: “Tahmoor coking coal is well known and regarded in the domestic and international markets for its grade and quality.

“The Tahmoor operation is another good fit within Simec's global portfolio allowing vertical integration for the Whyalla steelworks and flows to the broader GFG international network.”

The $10bn group, which has assets across metals, industrials and energy, announced last month it was making its first step onto the stock market with plans for a £1bn listed renewable energy platform.

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