Yancoal Australia, backed by Chinese investment, is set to acquire a significant majority stake in one of Australia’s largest underground coal mines, a move that has drawn both praise and criticism from various sectors.
The Queensland state government has welcomed the acquisition as a strong endorsement of the coal industry, while environmental advocates have expressed their disapproval of the sale.
According to Yancoal, the transaction is expected to be finalized by the end of the third quarter of this year, contingent upon receiving the necessary regulatory approvals.
This acquisition involves the purchase of an 80 percent interest in Kestrel Coal Mine, located approximately 40 kilometers north of Emerald in central Queensland. Kestrel is currently jointly owned by EMR Capital, a global private equity firm, and Indonesia’s Adaro Energy. The remaining 20 percent stake is held by Mitsui Coal, which is not included in this transaction.
Yancoal plans to invest up to $2.4 billion (approximately $3.36 billion) in this acquisition, which will enhance its already extensive portfolio that includes interests in at least ten mining operations across Australia. The company is primarily owned by Yankuang Energy Group, a major coal producer in China that is a part of the state-owned Shandong Energy Group.
Queensland Mines Minister Dale Last described the acquisition as “another major vote of confidence” in the state’s coal sector, asserting that it demonstrates Queensland’s openness to business and willingness to collaborate with investors who support the region.
Conversely, Anthony Gough, acting director of the Queensland Conservation Council, criticized the acquisition, arguing that increased coal extraction contributes to climate change and that companies should prioritize sustainable practices and community welfare over short-term profits.
Yancoal characterized Kestrel as Australia’s largest producing underground coal mine, noting that it produced nearly 6 million tonnes of coal in 2025. This mine, which has an estimated lifespan of 25 years, primarily produces metallurgical coal for steel production, with most exports heading to Asian markets via Gladstone.
Yancoal’s Chief Executive, Sharif Burra, emphasized that the acquisition aligns well with the company’s strategic goals, highlighting the favorable long-term outlook for metallurgical coal driven by ongoing steel demand in Asia and limited global supply.
However, the Queensland Conservation Council pointed to federal treasury models indicating a projected 50 percent decline in the value of Australian coal and gas exports by 2035, urging mining companies to pivot towards more sustainable industries to support their local communities.
EMR Capital’s CEO, Jason Chang, expressed satisfaction that the mine would be passed on to a capable operator, noting a 20 percent production increase since 2018. He acknowledged the strength of the coal industry while also hoping for a reevaluation of Queensland’s coal royalty framework, which he claimed had negatively impacted their asset value.
Currently, over 800 individuals are employed at Kestrel Coal Mine. Chang expressed confidence in a smooth transition of ownership, a sentiment echoed by a Yancoal representative, who confirmed ongoing collaboration with the sellers and management to ensure minimal disruption for the workforce during this transition period.
Pending the required regulatory approvals, Yancoal aims to finalize the acquisition by late Q3 of this year.
