Vale Colombia

Vale Colombia is a wholly owned subsidiary of the global mining company, Vale. Vale Colombia's only operation is the El Hatillo coal mine. The company states that the mine, which produces thermal coal, is located in 210 kilometers southeast of Santa Marta in the central portion of the Cesar Department in Colombia. The company states that "the concession area is adjacent to the town of La Loma and encompasses an area of 9,693 hectares."

In 2012, Vale Colombia agreed to sell its thermal coal assets in Colombia for $407 million to a unit of Goldman Sachs. The divestiture includes Vale’s El Hatillo mine, the Cerro Largo deposit, a port facility on the Atlantic coast of Colombia, and an 8.4 percent stake in the railway that links the mines with the port.

In May 2012 it was announced that Vale sold its Colombian coal assets to Goldman Sachs' Colombian Natural Resources SAS for $407 million cash. Vale reported that they were going to refocus their efforts on their metal extraction production.

Background
In late December 2008 Vale bought the El Hatillo mine and other coal exploration projects from Cementos Argos for $300 million. In a media statement the company stated that the deal included the "El Hatillo, open pit mine, with expected 2008 production of 1.8 million metric tons of thermal coal ramping up to full capacity - 4.5 million metric tons per year - by 2011, and (b) Cerro Largo, under exploration stage. Together these mining concessions have potential for 500 million metric tons of non-audited geological resources."

The company also stated that within the El Hatillo concession was the Las Cuevas deposit, which it stated "presents the highest potential for additional resources, and Vale has agreed to make an extra payment at fixed price per metric ton of measured and indicated resources exceeding 50 million metric tons, after a confirmatory drilling campaign to be concluded within two years."

Also included in the deal was Argos's coal infrastructure assets. "Argos has 8.43% stake in the Fenoco consortium that owns the concession and operation of the railroad linking the coal concessions to the SPRC port. It also owns 100% of the concession of the Rio Cordoba - SPRC port in the Caribbean coast of the Magdalena Department. Its coal production, which currently uses trucks to reach the port, will begin railroad transportation at the beginning of 2009," Vale stated.

Operation
In its outline of capital expenditure plans for 2011, Vale stated that the El Hatillo, which had US$102 million earmarked for it, is "ramping up to reach its nominal capacity of 4.5 Mtpy in 2012."

The company states that the mine is likely to be depleted by 2021.

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