BHP today announced that it has signed a Sale and Purchase Agreement with Glencore to divest its 33.3 per cent interest in Cerrejón, a non-operated energy coal joint venture in Colombia, for US$294 million cash consideration.

The transaction has an effective economic date of 31 December 2020. The purchase price is subject to adjustments at transaction completion which may include an adjustment for the dividends paid by Cerrejón to BHP during the period from signing to completion.

Alongside BHP and Anglo American, Glencore currently holds a 33.3 per cent interest in the operation. Glencore intends to acquire both BHP and Anglo American’s holdings.

Subject to the satisfaction of customary competition and regulatory requirements, Glencore would assume full ownership and operating control of Cerrejón. We expect completion to occur in the first half of the 2022 calendar year.

Selling BHP’s financial interest to a current Cerrejón shareholder who understands the operation represents a strong outcome for Cerrejón and the stakeholders it supports.

A further impairment charge of approximately US$80 million post-tax will be recognised as an exceptional item in the financial results for the second half of the 2021 financial year.