JSW Steel, an Indian multinational steel producer, is reportedly in discussions to acquire a stake in the Blackwater metallurgical coal mine, owned by Australia’s Whitehaven Coal, according to a Reuters report.
This development comes as the steel giant seeks to secure its supply of coking coal, a vital ingredient in steel production.
According to the report, JSW Steel is currently conducting due diligence and expected to receive a coking coal sample from the Blackwater mine this month to assess its quality.
The move is part of the company’s broader strategy to reduce dependency on imported coking coal.
Recently, Whitehaven Coal said that it is considering the divestment of approximately 20% of its interest in the Blackwater mine.
The Australian miner is looking to engage global steel producers as strategic joint venture partners.
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By GlobalData
Sources indicate that JSW Steel might be interested in acquiring a larger share than the proposed 20%.
Initial discussions between JSW Steel and Whitehaven Coal have taken place, but the Indian company is awaiting detailed specifications of the coking coal from the Blackwater mine.
JSW Steel’s current coking coal imports come from various countries including Canada, Australia, the US, and select grades from Russia.
The company has been actively scouting for coking coal assets overseas to bolster its raw material security and mitigate risks associated with volatile global markets.
In October last year, Whitehaven signed an agreement with BHP and Mitsubishi Development to purchase the Daunia and Blackwater coking coal mines in Queensland in a $4.2bn (A$6.45bn) deal.
The Daunia coal mine is located next to Whitehaven’s Winchester South development project in the Bowen Basin.
Meanwhile, Blackwater, an open-pit mine, is said to be one of the largest coal mines in Australia.
The mine’s coal production over the next five years is estimated at around 12.4 million tonnes per annum.
In July 2023, it was reported that JSW Steel is planning to buy up to a 20% interest in the steelmaking coal business of Canadian miner Teck Resources.
