Some of Australia’s Dirtiest Coal Mines Are About to Change Hands. Here’s Why We Should Be Worried

Why It Matters

The deal places some of Australia’s dirtiest coal operations under owners with limited emissions‑management experience, raising the risk that the mines will contribute up to 2% of national greenhouse‑gas emissions without robust mitigation. Regulators and investors will need to scrutinize how fragmented ownership affects compliance with the Safeguard Mechanism and Australia’s 2035 climate targets.

Key Takeaways

• Anglo sells four high‑methane Queensland coal mines to Dhilmar
• Dhilmar, backed by Indonesian conglomerates, lacks coal‑mining experience
• Mines could emit up to 2% of Australia’s CO₂ by 2028
• Existing methane‑capture systems depend on Anglo’s investment and partnerships
• Regulatory oversight may determine emissions under fragmented ownership

Pulse Analysis

Anglo American’s divestiture of its Queensland coal portfolio marks a rare high‑profile exit from one of Australia’s most emissions‑intensive sectors. The four mines—Capcoal, Moranbah North, Grosvenor and another unnamed asset—accounted for roughly a quarter of the state’s reported scope‑1 emissions in 2023. While Anglo invested more than $100 million in methane‑drainage and capture infrastructure, the assets have historically struggled with safety incidents and volatile underground conditions, prompting temporary shutdowns that temporarily lowered emissions by about one million tonnes.

Under Dhilmar, a 18‑month‑old entity registered in the UK and backed by Indonesia’s Medco and Salim groups, the mines will operate alongside Japanese steel partners Nippon Steel, Mitsui & Co. and JFE Mineral. The new owners inherit sophisticated pre‑mine drainage systems that currently abate up to 700,000 tonnes of CO₂e annually, but those systems rely on ongoing capital and coordinated partnerships—elements that may be harder to sustain without Anglo’s corporate oversight. Moreover, the Safeguard Mechanism’s baseline calculations, set during higher‑production years, grant generous credit allocations that could mask actual emissions growth if production ramps up.

The broader climate implications are stark. If the mines resume full output by 2028, they could contribute between 1% and 2% of Australia’s total emissions, potentially rising to 4% under a 2035 target scenario. This places pressure on federal regulators to enforce stricter emissions accounting and on investors to demand transparent methane‑management plans. The transaction underscores a growing trend of legacy high‑carbon assets moving into opaque ownership structures, highlighting the need for vigilant policy oversight to ensure Australia’s climate commitments are not undermined.