Anglo American’s agreement to sell its Queensland steel-making coal operations to UK-registered Dhilmar for up to $3.88bn (£3.29bn) marks one of the most significant ownership changes in Australia’s metallurgical coal industry in recent years.
While the transaction advances Anglo American’s strategy of focusing on copper and other future-facing commodities, it also transfers control of a portfolio of assets in the heart of Australia’s most important coal-producing region.
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The portfolio includes Anglo American’s interests in Capcoal, Dawson, Grosvenor, Moranbah North, Moranbah South and Roper Creek, supplying premium hard coking coal – the highest-value segment of the metallurgical coal market – to global steel-makers.
Queensland’s competitive position is strengthened by its role in the steel value chain. Located in the Bowen Basin, the assets produce premium hard coking coal characterised by high carbon content, low ash and sulphur levels, and strong coke-making properties. Queensland producers extract and process this coal before exporting it to overseas steel-makers, avoiding the substantial energy, emissions and capital costs associated with coke production and blast furnace steel-making.
The transaction is particularly significant given Queensland’s dominant role in Australia’s coal industry. The state accounted for 245.1 million tonnes (mt) of coal production in 2024, representing 53.1% of Australia’s total output, while Queensland and New South Wales together contributed more than 90% of national coal production, according to GlobalData. The Bowen Basin remains one of the world’s most important sources of metallurgical coal, underpinning Australia’s position as a major supplier to global steel-makers.
The Anglo American sale to Dhilmar is made up of $2.3bn in upfront cash and up to $1.58bn in contingent payments linked to future coal prices. The structure provides immediate value for Anglo American while preserving some exposure to future metallurgical coal market upside.
The agreement follows the collapse of Anglo American’s previous sale process with Peabody Energy, which had agreed to acquire the assets in 2024 before withdrawing in 2025 following operational disruptions at Moranbah North.
A fire at Moranbah North in March 2025 forced the withdrawal of underground personnel and led to a recovery and restart programme. At its Grosvenor metallurgical coal mine, recovery efforts continue following an underground fire in 2024, with production set to resume by late 2027.
The transaction forms part of Anglo American’s broader coal divestment programme, following the sale of its minority interest in Jellinbah and the disposal of Peace River Coal in Canada. Together, these transactions could generate approximately $4.9bn.
For Australia, the sale highlights a broader trend among major diversified miners. Companies such as Anglo American and BHP have increasingly prioritised copper and other commodities linked to electrification and energy transition themes, while reducing exposure to coal.
GlobalData forecasts Australian metallurgical coal production will remain relatively resilient, reaching 165.6mt in 2035. Although overall coal production is expected to gradually decline over the coming decade, metallurgical coal is expected to remain an important component of steel-making supply chains, particularly across Asia.
Further evidence of continuing confidence in Queensland’s metallurgical coal sector can be seen in the development pipeline. Projects including the Centurion Restart, Hillalong, Moranbah South and Red Hill are advancing through construction, permitting or study phases, indicating that producers are continuing to invest in future coking coal supply despite longer-term decarbonisation pressures.
For Anglo American, the expected completion of the transaction in the first quarter of 2027 would remove a major non-core business and accelerate its transformation into a more streamlined, copper-focused mining company.
For Dhilmar, the acquisition provides immediate exposure to a large-scale Australian metallurgical coal portfolio in one of the world’s most important export jurisdictions, with established supply links to major steel-producing economies including Japan, South Korea, India, Taiwan and China.
