Coal news and updates

POSCO running the ruler over Peabody coal assets

Peabody Energy is in talks with South Korean steel giant POSCO about selling a minority interest in its North Goonyella coal mine in north Queensland.

Street Talk understands the United States coal giant has been in on-again, off-again discussions with POSCO for months but the two companies have thus far been unable to agree on price.

But with Peabody moving to cut its Australian exposure, discussions are believed to have reignited.

Sources said Swiss commodities giant Glencore, Mick Davis' X2 Resources, local coal miner New Hope, as well Chinese and Indian buyers have had a look at the Peabody portfolio, after receiving sale fliers.

Street Talk revealed last week Peabody was selling most of its Queensland coal exploration portfolio and it's understood production assets are also on the block at the right price.

Sources said North Goonyella was the most saleable of the production assets.

The news comes after POSCO offloaded its 15.2 per cent stake in copper producer Sandfire Resources, worth $130 million, in May. POSCO appointed Citi to handle the trade, as revealed by Street Talk.

Ex-BHP Billiton executive Glenn Kellow tooks the reins as Peabody chief executive in May, and is looking to put his stamp on the company.

Peabody said last month it would shed up to 210 jobs and cut production at North Goonyella, as depressed prices for both thermal and metallurgical coal continued to deteriorate.

Elsewhere, first-round bids for Australia's largest privately-owned beef producer, Consolidated Pastoral Company, are due on Thursday. The Carlyle Group, offshore sovereign wealth funds and trade buyers such as China Investment Corporation (CIC) and the Queensland government's investment arm QIC are said to be among prospective local acquirers.

Credit Suisse and Barclays are sell-side advisers.

source: http://www.afr.com