BHP Billiton has entered into a deal with an arm of PT Adaro Energy to sell its 75% interest in IndoMet Coal and its coal assets in Indonesia — the latest move by the company to streamline its portfolio.
Officials said June 7 that the buyer is PT Alam Tri Abadi, the Adaro subsidiary that already holds the remainder of the business. Unnamed sources told several media outlets that the deal was worth $120 million.
IndoMet Coal is made up of seven coal contracts in central and eastern Kalimantan, including its Haju operation that began operations in 2015. That operation alone has a production capacity of 1 million metric tons (mt) annually.
“After a detailed review of IndoMet Coal, we concluded that although the project could support a larger scale development, BHP Billiton has a range of other growth options in the portfolio that are more attractive for future investment,” said IndoMet Coal Asset President James Palmer.
No completion date for the sale has been provided, as it is conditional upon several regulatory approvals. In the meantime, BHP said it and Adaro will work jointly to facilitate a fluid ownership transfer.