In what has been tagged “great news”, a UK billionaire has snapped up Tahmoor Underground Mine in Wollondilly.
Sanjeev Gupta’s GFG Alliance will pick up the mine from commodities giant Glencore for an undisclosed sum.
It is understood Mr Gupta had been out to the mine several times in recent months, the latest visit coming a few weeks before Christmas.
The purchase is seen as a good fit for Mr Gupta’s company, which already owns the South Australian steelmaker Arrium.
He bought the steelmaker in August last year, saving the Whyalla steelworks from closure.
Tahmoor employs 340 people and produces around two million tonnes a year, most of which is hard coking coal for steelmaking.
The Whyalla Steelworks has been buying coal from Tahmoor Mine for more than a decade.
“The acquisition of the Tahmoor mine is an exciting step forward in our stated strategy to create fully-integrated, end-to-end businesses in Australia, from raw materials and energy right through to high-value finished products ready for market,” Mr Gupta said.
“I very much look forward to welcoming the Tahmoor mine employees and surrounding community into our GFG family.
"Through this purchase we secure and de-risk an important feed for the Whyalla Steelworks.”
He said the purchase of Tahmoor, along with the company’s iron ore mines in South Australia meant GFG was the “only fully integrated Australian steel producer”.
In statement, Glencore said it had reached agreement with SIMEC, the mining division of GFG Alliance.
“The transaction is subject to approval from the NSW Government and is expected to be complete in the first quarter of 2018,” the statement said.
“It will be business as usual until then.”
Bob Timbs, CFMEU district vice president, saw the purchase of Tahmoor as a vote of confidence in the mine’s future.
“It’s great news for our members and the community,” Mr Timbs said.
“Tahmoor colliery has employed a large number of people from the Southern Highlands and the Illawarra over a number of years and it’s very pleasing to see that this will continue.”
Mr Timbs said the union had not sat down for talks with GFG Alliance.
“No, it’s early days yet,” he said.
“They’ll obviously come in and have a look at the mine, see how it’s operated and make a decision about the future of the mine.
“But if he’s purchased the mine for an unknown amount – he’s obviously there for the long haul.”
In 2016, Glencore announced it would not continue mining beyond 2018 at Tahmoor due to the low coking coal price.
However, a rise in the prices saved the colliery from closure, ensured the local miners would keep their jobs and prompted Glencore to look for a buyer.
The mine could be viable for another 15 years with more longwalls mined in the future.