12 Jul BHP considering plans to divest thermal coal business
BHP has become the latest mining giant to consider exiting thermal coal as climate change pressure from investors and activists continues to push companies away from polluting fossil fuels.
According to unnamed sources familiar with the matter, BHP is looking at options to divest its thermal coal assets in Australia and Colombia. However, there is no guarantee the company will go ahead with a sale, the people said.
Rival miner Rio Tinto has already removed its exposure to thermal coal, which is considered the one of the dirtiest fossil fuels, while Anglo American has been cutting production amid growing pressure from investors. Even the world’s biggest shipper Glencore has said it will look into reducing output.
Despite thermal coal only contributing to a small section of BHP’s overall portfolio, the world’s largest mining company has already indicated a reduced interest in the sector, after chief financial officer Peter Beaven said it had no appetite for growth in the commodity earlier this year.
Instead BHP’s long-term strategy will primarily focus on iron ore, especially after the firm recently announced it could build up to 11 more iron ore mines over the next 50 to 100 years in Western Australia’s Pilbara region.