20/01/2014 - 12:19

Wesfarmers plans $70m coal purchase

20/01/2014 - 12:19

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Wesfarmers is set to acquire a coal development licence worth $70 million from Peabody Energy, in a purchase which the company says will boost its total coal reserves by about 29 per cent.

Wesfarmers plans $70m coal purchase

Wesfarmers is set to acquire a coal development licence worth $70 million from Peabody Energy Corporation, in a purchase the company says will boost its total coal reserves by about 29 per cent.

The diversified conglomerate has agreed to purchase a mineral development licence near its Curragh open-cut coalmine in Queensland's Bowen basin, containing 67 million tonnes of coal reserves within a total coal resource of 255mt.

Wesfarmers said the acquisition would significantly bolster the total base of coal reserves potentially available for mining and processing at Curragh's coal handling and preparation plants, potentially allowing the company to extend Curragh's mine life.

However the company said further work was required to convert the licence to a mining lease.

Wesfarmers Resources managing director Stewart Butel said the acqusition reflected Wesfarmers' confidence in the longer-term otlook of Curragh's export coal business.

Completion of the deal is expected to occur within the next two weeks.

Wesfarmers shares were trading 21 cents lower at $43.49 at 12:16pm WST.

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