Mining group Exxaro Resources has agreed to buy Total's South African coal mines for $472m, to expand its portfolio in the country.
Under the deal, Exxaro will buy a 100% stake in Total Coal South Africa (TCSA), its export rights at the Richards Bay Coal Terminal (RBCT) and settle all outstanding loan claims, estimated to be around $85.5m.
The fifth largest coal exporter in South Africa, TCSA operates three coal mines in the Witbank and Highveld coal basin in Mpumalanga, and owns a 74% stake in the Dorstfontein and Forzando mines, with the remaining 26% owned by Mmakau Mining.
Total gas and power president Philippe Sauquet said: "This sale is part of the group's 2012 to 2014 asset sale programme and is in-line with Total's objectives to focus on its core activities and to actively manage its portfolio.
"While Total has made the necessary investments to position TCSA for growth in the medium term, Total believes TCSA will have the opportunity to maximise its long-term potential with a new strategic coal investor."
Exxaro currently operates seven coal mines that produce around 40 million tonnes (Mt) of coal a year, supplied to local customers including the power utility Eskom Holdings.
The acquisition will provide Exxaro with an additional 4.09Mt a year of shipping capacity at Richards Bay Coal Terminal, helping increase its exports.
The shipping capacity at the terminal will double to 8Mt that will be used for future export requirement.
Exxaro is planning to fund the deal using its existing corporate debt facilities.
Exxaro CEO Sipho Nkosi said: "Exxaro is delighted with its success regarding the acquisition and for the growth opportunities it will provide for Exxaro, as well as the contribution to the South African economy in terms of continuing employment and foreign earnings."