BHP Billiton today announced that it has reached agreement to sell Optimum Colliery (a thermal coal mine within BHP Billiton's South African portfolio), together with 6.5Mtpa of Richards Bay Coal Terminal entitlement to an entity controlled by a Black Economic Empowerment (BEE) consortium, Optimum Coal Holdings (Pty) Ltd (OCH). OCH is a broad-based BEE grouping led by Eliphus Monkoe, a previous Chief Operating Officer (COO) of BHP Billiton Energy Coal South Africa (BECSA). OCH has 65% BEE ownership, including 12.5% to be issued each to employees and communities.
The sale will be effective from 1 July 2007, however BHP Billiton will continue to manage and operate Optimum until completion. BHP Billiton will also acquire and market substantially all export coal from Optimum over the life of the mine. Completion of the sale is subject to the conversion and transfer of Optimum's mining rights in terms of the Minerals and Petroleum Resources Development Act of 2002. OCH will also take full responsibility for all Optimum liabilities including environmental rehabilitation and water management.
Wayne Isaacs, Chief Operating Officer of BECSA said: "This is an important BEE transaction and BHP Billiton is very pleased with the outcome of the sale process. We believe that the new ownership structure is in the best interest of all stakeholders, particularly as we understand that Eliphus and his team will be committing substantial capital and resources into the mine to ensure its long term sustainability.
Optimum Colliery is situated 200 kilometres east of Johannesburg in Mpumalanga Province. It supplies energy coal to Hendrina power station as well as the export markets. The mine produced 11.6 million tonnes of saleable steam coal in the twelve months to June 2007 (including 5.4mt of export coal) and has a workforce of some 1070 employees and 1397 contractors. Optimum Colliery is 100% owned by BHP Billiton.