Anglo under fire for ‘green-washing’ ahead of June 7 Thungela Resources listing

ANGLO American had overstated the thermal coal sales and understated the rehabilitation costs of Thungela Resources, according to research company Boatman Capital.

Citing a report by the research house, described as ‘secretive’, the Sunday Telegraph said today that Thungela Resources was worthless. The report comes just as Thungela Resources is due to make its debut on the London and Johannesburg stock exchanges.

The heart of the report claims that environmental laws in South Africa, currently under consideration by the government, would result in rehabilitation costs much higher than set down by Anglo, said the Sunday Telegraph.

Anglo said that the law changes that would affect rehabilitation costs were “controversial” and were still under discussion. The matter had been raised by the Minerals Council South Africa in terms of submissions it has made to the government, the group said.

Boatman Capital is said to have scored successes against the UK defence contractor Babcock following a report it compiled three years ago in which it said the company had “buried a lot of bad news” and was facing “potentially massive exceptional costs”. The company recently wrote down its business by £1.7bn, said the newspaper.

Thungela Resources is the creation of the de-merged South African thermal coal assets previously held in Anglo Coal. Mark Cutifani, CEO of Anglo, said previously a demerger was the most elegant solution to the group’s decarbonisation plans as it would allow shareholders to remain invested in the company whilst providing for “a just transition” in terms of South African coal.

However, Boatman Capital concluded in its report that: “The demerger allows Anglo to dump enormous environmental costs onto a much less well capitalised company.

“To us, this looks like greenwashing: Anglo is claiming to be acting positively by reducing its greenhouse emissions while seemingly washing its hands of clean-up obligations. Thungela seems to have significantly under-estimated its environmental liabilities and therefore could have given investors a misleading impression of the company’s value.”

Anglo will inject R2.5bn into Thungela and said it would also continue to provide financial support to the company until end-2022 in the event rand-denominated thermal coal prices fell beneath a certain threshold.

Anglo American produced 16.5 million tons from its South African coal assets during its 2020 financial year, a 7% year-on-year reduction, producing a $15m underlying EBITDA loss, and taking EBITDA losses over two years to $20m.


  1. Agreed. Anglo was supposed to discontinue the operations of Thungela, in a phased approach and after satisfying all ESG protocols.

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