Linc Energy Ltd., which converts coal into liquid fuels, is in talks with three to four groups to sell an Australian coal asset valued at more than A$500 million ($506 million), Chief Executive Officer Peter Bond said.
Negotiations are on for the Teresa mine in Queensland’s Galilee basin, Bond said today on the sidelines of a media presentation in Sydney. He didn’t specify a timeframe for the transaction.
“We’re firming up the asset to make it look attractive for a buyer,” Bond said. The buyers are “the usual suspects from Australia, China and the Americas and also a couple of second tier ones,” he said.
Linc sold the Galilee coal asset for A$3 billion in cash and royalties to India’s Adani Enterprises Ltd. in August, the biggest acquisition by an Indian company in Australia. Demand for coal from steel and power producers has spurred mining companies to add assets. Alpha Natural Resources Inc. agreed on Jan. 29 to buy Massey Energy Co. for $7.1 billion in cash and stock, the biggest deal in the industry’s history.
“Similarly to the Adani deal, Teresa is now building momentum,” Bond said.
Linc Energy shares gained as much as 1.4 percent to A$2.89 and traded at A$2.86 as of 3:18 p.m. in Sydney. The stock has gained about 8 percent this year.