* To sell royalty portfolio, stake in coal development
assets to Altius Minerals for C$481 mln
* Westmoreland Coal will buy operating coal assets for C$465
* Sherritt expects to record loss of about C$460 mln on the
Dec 24 Canada's Sherritt International Corp
said on Tuesday it would sell its coal business for C$946
million ($893 million) to focus on its nickel and oil
Sherritt said it would sell its entire royalty portfolio and
stake in coal development assets to a group led by mining
company Altius Minerals Corp for C$481 million.
Westmoreland Coal Co will buy Sherritt's operating
coal assets - Prairie and Mountain Operations - for C$465
"(The sale) ... gives us the capacity look at more
opportunities to grow those businesses where we feel we have a
real differentiating experience," Sherritt Chief Executive David
Pathe said in an interview to Reuters.
Sherritt's coal business has been struggling due to weak
customer demand that has pulled down thermal coal prices. Coal
production volumes at both its Prairie and Mountain operations
fell in the third quarter.
Demand for thermal coal, used to generate electricity, has
weakened in North America as power producers turn to cheap,
abundant supplies of shale gas.
Sherritt said on Tuesday it expects to record a loss of
about C$460 million on the disposal, of which C$308 million will
be goodwill related to the purchase of coal assets in 2008.
Toronto-based Sherritt has nickel mining and refining
projects and operations in Canada, Cuba, Indonesia and
Madagascar. It also has oil and power operations in Cuba.
The sale comes nearly two months after a wall collapsed at
one of the company's coal mines, releasing millions of litres of
wastewater into the Athabasca River.
Alberta regulators ordered Sherritt in November to clean up
the spill - containing clay, mud, shale and coal fines - and
investigate the leaks.
Pathe said the investigation was still unfolding and there
would be greater clarity on the leak in the spring season as
much of the river was frozen now.
Sherritt shares, which had fallen about 41 percent this year
through Monday, were up 9 percent at C$3.68 on Tuesday on the
Toronto Stock Exchange.