The anonymous senior executive told Reuters that the firm had been approached by several Asian end users due to the operation’s low costs.
“We have a profitable bituminous coal mine with the lowest cash costs in the US and long-term port capacity – two important criteria for US coal investments,” the source reportedly said.
The large interested buyers recently visited Signal Peak.
They have a desire to diversify supply through an equity stake purchase.
Gunvor’s Pinesdale subsidiary paid $US400 million for one-third of the complex near Billings in October 2011. The other owners are large utility FirstEnergy and private Ohio group Boich.
“With big groups like Glencore dropping more than 40 per cent in value this year alone, it's easy to gripe at any recent investment in the commodities space, but the value is there for the longer-term,” the executive reportedly told Reuters.
Boich chief executive Wayne Boich reportedly said: “The only real short-term negative since [Gunvor] bought [the interest] is that the coal market is down a bit.”
Gunvor meanwhile, has put its hands into the international arena as well, trading coal and investing in mines in South Africa as well as the Kolmar complex in Russia.
“Gunvor's purchase of an interest in the mine added a partner with robust exposure to the international market,” Boich told the news service.
The unnamed Gunvor executive pointed to Signal Peak’s performance in the face of market uncertainty. Thermal coal prices slipped from more than $100 a tonne to Europe delivered to a two-year low of about $80 in June along with defaults by Chinese buyers, the Montana mine’s sales were profitable and demand for its coal is still strong.
Signal Peak’s output goes primarily to Europe, Latin America, China and other parts of Asia.
The export market has been quite attractive to many US mines this year, especially with domestic demand falling as fast as the prices of its biggest competitor, natural gas.
Additionally, end users from South Korea and Japan have also gone after thermal equity and coking coal mines to secure supplies in the long-term.
