Anglo could sell more Aussie coal mines

Anglo American is mulling the sale of two more of its coal mines in Queensland.

The news comes after the miner announced it had put its Callide and Dartbrook mines on the market in December.

A source told Bloomberg the company may also look to offload its Dawson and Foxleigh mines.

An Anglo American spokesperson told Australian Mining that in terms of its broader coal portfolio everything is currently under review and the outcome of that review is still to be determined.

The move is part of a company-wide coal shakeup which will also see the review of South African operations.

It comes as Anglo announced it would further reduce capital expenditure by $US500-800 million in 2014 and by up to $US1 billion in 2015 to $US5.2-5.5 billion.

By 2017 Anglo is targeting productivity to improve by 80%, with 35% fewer people globally through growth and restructuring.

Both thermal and coking coal prices are expected to remain subdued this year as global supply takes over demand.

This means the focus on cost structures will continue, with wages and employment to come under pressure as the capital-intensive industry seeks additional productivity gains.

Employment is expected to decline at a compound annual rate of 3.9 per cent over the next five years as other areas of the industry's cost structure are less flexible.

From 2016 the market balance is expected to tighten as more mines close and availability tightens- resulting in slight price rises from 2018.

Late last year Anglo’s CEO Mark Cutifani said coking coal mines will be closed or suspended at a steady rate until a reduced supply drives a price recovery.

He stated that the mines, globally, will most likely shut at a rate of about one every two to three weeks until a lack of supply affects the price.

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