London-based mining group Billiton Plc has acquired a one third stake in the Carbones del Cerrejon (CdelC) coal project in Colombia alongside Anglo American Plc and Glencore International AG. Billiton effectively replaces Rio Tinto which sold its one third stake in January. Financial details of the transaction were not made public but mining analysts suggested Billiton would pay $US125-150 million for the holding in CdelC.

James Campbell, executive director of Anglo American with responsibility for Anglo Coal commented, "This is another important step in the development of coal exports from Colombia, and we welcome this further relationship with Billiton."

CdelC has rights to mine three high calorific value, low sulphur, and low ash thermal coal reserves in northern Colombia totalling 2 billion tons from Cerrejon Central, Oreganal and Cerrejon South.

There may in future be an opportunity for the company to buy into the adjacent Cerrejon North deposit held by Carbocoal, which is 50% owned by the state. The Colombian government has indicated it may sell its interest and CdelC could be well placed to bid.

CdelC currently produces only about 3 million ton per annum of export steam coal, largely because it has never had adequate infrastructure to export the coal. Until last year access to the port was controlled by the northern part of the coalfield, owned by Exxon Mobil and the Colombian government. CdelC signed an agreement to use the railway line connecting with the port last year, opening the way for profitable export trade and a significant production increase. A feasibility study is nearing completion to evaluate expanding annual produciton to 13 million ton at an estimated cost of $US500-600 million.

CdelC supplies coal to the U.S., Europe and the Middle East, via Puerto Bolivar and is expected to post a small profit this year now that CdelC has access to a rail link to the port.

Meanwhile, Lonmin Plc announced on May 23 the completion of sale of coal assets to Glencore for $US207.5 million. The deal includes Duiker Mining and Tweefontein United Colliers Ltd

Glencore said it had the support of 94,6% of Duiker's shareholders for its offer and would delist the company. This means none of South Africa's export coal producers will be listed on the Johannesburg Stock Exchange.

Glencore said it believed the world's steam coal industry would be controlled by four or five players in 12 months to 18 months and that it wanted to be one of them.