JSW Steel is in discussions to acquire a 20 percent stake in the Blackwater coal mine, owned by Australia's Whitehaven Coal, in a deal valued between $750 million and $1 billion, said sources familiar with the matter.
The mine, situated in Queensland's Bowen Basin, is one of the largest open-cut metallurgical coal producers in the region, expected to yield an average of 14.8 million tonnes of saleable metallurgical coal annually over the next five years.
JSW Steel has not confirmed the development.
Whitehaven Coal had previously announced its intention to sell a 20 percent stake in the mine to global steelmakers, aiming to bring them in as strategic joint venture partners.
The company has set a mid-March deadline for the first round of bids, with the name of the successful bidder to be announced on or after April 2. Other interested parties include Australia-based Indian company AvidSys Group, as well as Japanese trading houses Itotchu, Marubeni, and Sojitz.
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JSW Steel has been actively seeking to acquire mines, both domestically and internationally, to secure its coking coal supply. A previous attempt to acquire up to a 75 percent stake in Canada's Teck Resources' metallurgical coal business did not materialize. The company is now exploring various options, including acquisitions and strategic alliances, to enhance its coking coal supply.
JSW Steel is aiming to increase its production capacity to 37 million tonnes per annum by FY25 and to 50 MTPA by 2030, necessitating additional raw materials such as coking coal. The company's expansion plans include adding a total of 8.5 MTPA this year, taking its total capacity to 36.7 MTPA from the current 28.2 MTPA. It currently operates 13 mines and has secured another seven iron ore and two coking coal mines through government auctions in 2023.
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