While Decker currently only services the US domestic market, Ambre, which has predominantly Australian and US shareholders, touts itself as an “export company” and talks up the projected growth of the Asian market, and has secured port facilities for potential coal export infrastructure in the US Pacific northwest.
As part of the Decker deal, Ambre has fully replaced Cloud Peak’s roughly $US66.7 million ($A73.5 million) in previously outstanding reclamation and lease bonds for the 40-year-old Decker mine, which produces about 3.8 million tonnes per annum.
Ambre has also granted Cloud Peak – one of the largest US coal producers and the only pure-play Powder River Basin coal company – an option for up to 7Mtpa of its throughput capacity at the proposed Millennium Bulk Terminals coal export facility.
Salt Lake City-headquartered Ambre is developing new port infrastructure in the US to facilitate what it sees as an emerging coal export and marketing business, while also operating and co-owning the Black Butte mine near Rock Springs, Wyoming, with Anadarko Petroleum Corporation.
The Decker mine has produced more than 300Mt of higher quality Powder River Basin coal for the US domestic market, but is geographically well positioned for Asian market via export through the Pacific Northwest.
Wood Mackenzie has forecast Asian demand to grow at 6.7% a year – that’s 1.3 billion additional metric tons of coal – until 2030.
Ambre has noted that the US is currently a minor supplier of thermal coal into the Pacific export market, accounting for only 8Mt of Asia’s 650Mt of thermal coal demand.