The move is part of a concerted push to get the global resources giant back into profitability under new chief executive Sam Walsh. It recorded a $3 billion loss for the six months to December.

The company has appointed Deutsche Bank to handle the sale, reports the Wall Street Journal.

The move comes after lower coal prices and the high Australian dollar ate into profitability for Rio Tinto Coal.

The company would reportedly offload its 50.1% share of Clermont and Blair Athol thermal coal complex as well as 29% of its Coal & Allied operation in the Hunter Valley.

In a statement to ILN, Rio Tinto said it did not comment on market speculation.

Walsh is looking to prune underperforming assets in the mining giant’s portfolio and some of the company’s coal assets are considered to be low-hanging fruit.

Rio Tinto energy head Harry Kenyon-Slaney is running a ruler over the company’s Australian coal operations from its Brisbane office and is expected to cut contractor and staff numbers for any mine that goes cashflow negative.

Kenyon-Slaney has also been given open slather to cut 15% from the operating cost base of Rio’s Australian operations over the next two years through smarter procurement, including a renewed push into emerging markets for sourcing goods and services.

"In response to lower coal prices, a high Australian dollar and high input costs impacting the coal industry in Australia, Rio Tinto is actively reducing controllable costs in this business," outgoing chief executive officer Tom Albanese said at the release of the company’s December quarterly.

“I should stress that all of our coal mines in Australia are cashflow positive but they will need to remain so if they are to stay in the portfolio.”

Kenyon-Slaney was running a broad reaching review and restructuring of the Australian coal portfolio, Albanese said late last year.

Clermont has been ramping up production, replacing Blair Athol which ceased production in January having been in operation for 30 years.

Earlier plans to continue mining lower grade coal at the Blair Athol mine beyond 2012 had to be shelved, Clermont region general manager operations Dawid Pretorius said.

“As coal prices rose in recent times we looked to extend the life of the mine by mining a poorer quality coal and harder to reach seam for a few more years,” he said.

“Unfortunately, the recent significant drop in thermal coal prices, and other factors such as rising costs and the foreign exchange rate mean this is no longer a feasible option and we will keep to the original plan to finish production in 2012.”

There are still around 30 roles at Blair Athol, including work in the coal handling and preparation plant and rail load-out facilities, which will continue to be used for coal from the nearby Clermont mine, as well as care and maintenance work in the lead up to a rehabilitation program.

Rio Tinto Coal Australia would not confirm last month that it was committed to staying in the Hunter Valley as speculation mounted that it must consider asset sales to get its balance sheet in order.

ILN column Hogsback had postulated that the global resources giant was under growing pressure to sell the Coal and Allied-managed mines at Bengalla, Hunter Valley Operations and Mount Thorley Warkworth to resolve its corporate debt crisis.