The race to open a $40 billion coal region in Australia is being led by billionaires Gina Rinehart and Clive Palmer. Victory depends on who wins approval to build a 500-kilometer (310-mile) railroad to the coast.
Record coal deals this year have slashed the number of potential targets in Australia, the world’s largest exporter. The combination of Whitehaven Coal Ltd. and Aston Resources Ltd. looms as the last prize standing.
Coal prices may rise after flooding and rainfall in Australia, the world’s biggest exporter of the commodity, disrupted production from mines in Queensland owned by companies including Rio Tinto Group and Macarthur Coal Ltd.
The world’s largest mining companies led by BHP Billiton Ltd. are struggling with higher costs to complete $200 billion in new projects, prompting them to slow work and turn instead to acquisitions and asset sales.
BHP Billiton Ltd. , Xstrata Plc and 11 other coal miners in Australia bid A$4.85 billion ($4 billion) for the nation’s biggest coal railroad to head off the state government’s planned initial public offering.
New Hope Corp., battling Peabody Energy Corp. and Noble Group Ltd. for control of Macarthur Coal Ltd., will look for other acquisitions if it is unsuccessful in its bid for Australia’s largest producer of pulverized coal, Chairman Rob Millner said.