MELBOURNE, April 20 BHP Billiton is considering quitting its coal assets in Indonesia, where it recently started shipping steel-making coal from a small mine, amid uncertainty over Indonesian regulations and a weak outlook for coal.
BHP owns a 75 percent stake in the IndoMet Coal project, having sold the rest to Indonesia’s Adaro Energy in 2010 for $335 million. Coal asset prices have collapsed since then, and analysts said BHP would be lucky to fetch $200 million now for the stake in a largely undeveloped resource.
“Does it move the dial for BHP? No. But it’s a really high quality met-coal property and potentially a fantastic opportunity for an Indonesian company with the right connections,” said Shaw & Partners analyst Peter O’Connor.
BHP, the world’s largest exporter of metallurgical coal, is considering a range of options for IndoMet, a spokeswoman said. She declined to comment on whether the company has entered into talks with any potential buyers for its stake.
“BHP Billiton is conducting a strategic review of the long-term future options for its Indonesian coal interests, IndoMet Coal, which comprises seven coal contracts of work within the provinces of Central and East Kalimantan,” the global miner said in its quarterly review.
For the rest of this article, click here: http://www.reuters.com/article/bhp-billiton-output-indonesia-idUSL3N17N1E9