Brookfield kicks off coal terminal sale

05 November 2019 - 12:00 am UTC

Brookfield has started the process to sell its AUD 2.4bn (USD 1.65bn) Dalrymple Bay Coal Terminal, sources confirmed.

The investor has appointed Bank of America Merrill Lynch and HSBC as joint lead managers to conduct a global search for interested buyers, according to two sources close.

The facility is owned by Brookfield Infrastructure Fund I (BIF I), originally known as Brookfield Americas Infrastructure Fund, the publicly listed Brookfield Infrastructure Partners and other co-investors.

The terminal – located south of Mackay, about 1,000km north of Brisbane – takes coal from the Bowen Basin under long-term “take-or-pay” contracts with the likes of Glencore, Anglo American and a BHP Mitsui joint venture.

As a monopoly asset, it is regulated by the Queensland Competition Authority. 

It is not known what the asset will sell for, but its regulated asset base is around AUD 2.4bn. Last year, 69.4 million tonnes passed through the terminal. It has a capacity of 85mtpa, with scope to expand to 136mtpa.

Brookfield acquired 100% of the asset in November 2010, according to Inframation Deals, when it finalised the purchase of all of the then-listed Prime Infrastructure for about USD 1bn after its collapse during the financial crisis. The Queensland government originally privatised the asset under a 99-year lease in 2002. 

It is selling Dalrymple Bay now as the closed ended BIF I is coming to the end of its life. 

Around 80% of the coal that passes through the facility is metallurgical. Australia is one of the biggest exporters of coal and just under 20% of the world’s seaborne coking coal passes through Dalrymple Bay terminal.

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