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Peabody Energy sells Australian tenement interest for A$104 million
By Caroline Salls
Pittsburgh, May 9 – Peabody Energy Corp. announced Monday that several of its Australian subsidiaries entered into sale and purchase agreements with Denham Capital portfolio company Pembroke Resources to sell the company’s interest in undeveloped metallurgical reserve tenements in Queensland’s Bowen Basin for A$104 million in cash plus a royalty stream.
According to a company news release, Peabody received cash proceeds of A$65 million as part of the transaction, with an additional A$22 million of cash proceeds expected to be received before the end of the third quarter once governmental and regulatory approvals are granted.
The company said the remaining proceeds are related to the sale of select tenements held by the Coppabella-Moorvale Joint Venture (CMJV) and are subject to approval by the CMJV partners and other conditions.
Peabody said the transactions include the Olive Downs South, Olive Downs South Extended, Willunga and Olive Downs North tenements, which consist of undeveloped proven and probable reserves.
The sale is part of Peabody’s overall portfolio management strategy aimed at improving the business across three core priorities of operational, financial and portfolio, the release said. Peabody expects to use transaction proceeds for general corporate purposes.
The company said the agreement contains no financing condition, with Denham Capital providing all funding for the transaction.
Peabody, a St. Louis-based coal producer, filed for bankruptcy on April 13 in the U.S. Bankruptcy Court for the Eastern District of Missouri under Chapter 11 case number 16-42529.
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