Integra's open cut could be the carrot

SPECULATION is mounting that Brazilian giant Vale is considering selling its troubled Integra underground mine in New South Wales as a “job lot” with the more productive open cut operation.
Integra's open cut could be the carrot Integra's open cut could be the carrot Integra's open cut could be the carrot Integra's open cut could be the carrot Integra's open cut could be the carrot

Integra Underground, courtesy Vale.

Lou Caruana

The Integra open cut produces about 300,000 tonnes of coal per month while the underground mine produces only 75,000t and has been plagued with technical and safety problems.

The future of the mine has been a source of speculation with reports that it could be sold or closed down after senior Vale management officials met last week with union representatives and other stakeholders over its future.

A report in the AFR said Vale, which owns 61.2% of Integra, has asked its JV partners – Chubu Electric, Toyota Tsusho, Posco, Nippon Steel and JFE Holdings – to forgo their pre-emptive rights in order to expedite the sale

process.

A spokesperson for Vale said the company does not respond to media speculation.

There are also reports that the company is considering its position in the Australian coal industry.

Vale’s three coal joint ventures with Aquila Resources in Queensland and some of its Galilee Basin tenements could also be on the block, according to the AFR.

Since a senior management change at Vale in Brazil which saw Murilo Ferreira replace Roger Agnelli, Vale’s coal strategy has come under question. The company may start to focus more on its domestic projects as the Brazilian government is urging it to back out of its global coal projects.

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