Singaporean consortium secures $850m for South32’s Australian coking coal
South32 said in February it had agreed to sell the business in New South Wales state for $1.65 billion.
Mineral sands explorer Iluka Resources Ltd said on Tuesday its full-year 2019 financial results would be impacted by a one-time charge related to its Sierra Rutile Ltd (SRL) operations in Africa.
Following an assessment, Iluka said it expects an impairment charge of $290 million related to SRL, as its operational performance continues to underperform the 2016 acquisition investment of $330 million in the unit.
As a result, the carrying value of SRL’s remaining net assets would be reduced to about $50 million, Iluka said.
It also said it expects an increase in rehabilitation liability by A$60 million ($41 million) to hurt full year 2019 results.
Iluka had purchased SRL to boost its rutile production capacity from 175 kt per annum to over 240kt per annum, but has been facing handling and maintenance issues, power outages, interruptions to mining due to weather conditions, among others.
The company said it expects SRL to produce about 135 kt of rutile in 2019, compared with 122 kt last year, and 170 kt in 2020.
SRL is the world’s largest natural rutile deposit. It contributed nearly 70% of the parent company’s rutile production in the September quarter.
($1 = A$1.4736)
(By Nikhil Subba; Editing by Maju Samuel and Shinjini Ganguli)
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