Mitsui takes over rich coal mine

By Geoff Hiscock
CNN Asia Business Editor

SYDNEY, Australia (CNN) -- Japanese trading house Mitsui & Co has moved to full ownership of the rich Moura open-cut coal mine in Queensland, paying $166 million for the 55 percent it did not own.

Mitsui exercised its right to the stake, which was held by Coal & Allied Industries, a unit of diversified resources group Rio Tinto.

In February, Coal & Allied said it would sell the stake to fellow Australian miner MIM Holdings, which wanted the Moura mine to help lift its coal production capacity (Full story).

But the deal was conditional on the reaction of Coal & Allied's 45-percent partner in the mine, Mitsui Moura Investments, which had the right to buy the whole stake if Coal & Allied wanted to sell.

Exported to East Asia

Mitsui sought and received approval from the Australian government last month to move to 100 percent ownership. Rio Tinto announced the completion of the sale late Wednesday.

Moura produces coking and thermal coal, and had pretax earnings of about $60 million last year.

The mine is in the southern part of Queensland's rich Bowen Basin coalfield. It is linked by rail to the port of Gladstone, 180 kilometers (110 miles) to the east.

Moura's output is exported to Japan, South Korea and Taiwan under long-term contracts.

Rio Tinto, which owns 72.7 percent of Coal & Allied, acquired the 55 percent stake in Moura when it bought the Peabody Group's Australian coal assets in January 2001.

Shares in Rio Tinto finished 0.6 percent higher Thursday at A$35.56. The broader market, measured by the S&P/ASX200, closed 0.17 percent higher at 3387.1.