A consortium comprising BHP Billiton, Anglo American and Glencore International AG has signed an agreement to acquire all of the ownership interests in International Colombia Resources Corporation (‘Intercor’) from Exxon Mobil.
Intercor owns 50% of the Cerrejon Zona Norte (CZN) mining operation in Colombia, as well as rail and port infrastructure in the region, and is the operator of these assets. The other 50% interest in CZN was acquired by the Consortium from the Colombian Government in November 2000.
Following completion of the transaction, the Consortium will have 100% ownership of CZN. BHP Billiton and the other Consortium members will each have a 33.33% interest in the operation (up from 16.67% interest prior to the acquisition).
The net asset value of Intercor is US$366 million. The transaction sale price and terms were not been disclosed for confidentiality reasons.
The individual members of the Consortium will each fund their pro rata share of the purchase consideration. Subject to the satisfaction of certain conditions, completion is expected to take place within a month.
The CZN mine is an open-cut operation currently producing about 19 million tonnes per annum of coal for export to international markets. CZN has a reserve life of more than 30 years at current production rates. The mine lies 18 kilometres north of Carbones del Cerrejon (CDC), an energy coal mine also owned equally by the Consortium members.