Japanese petroleum company Idemitsu Kosan has agreed to sell its 85% stake in the Ensham coal mine in Queensland, Australia to Sungela, a Thungela Resources subsidiary, for A$340 million, reported Reuters.

Bowen Investment (Australia) Pty owns the remaining 15% stake in Ensham.

Idemitsu Kosan will also receive a royalty payment based on the price and volume of coal to be sold from Ensham in 2023 and 2024.

“This will provide Thungela with access to the Japanese and other Asian markets, where demand remains strong, and better balance the group’s price exposure by providing access to the strong Newcastle export coal price,” said Thungela officials.

Idemitsu Kosan said it plans to close its Muswellbrook coal mine in New South Wales, Australia by the end of March. This will leave the Boggabri open-cut coal operation in New South Wales as the only mine in the company’s coal portfolio as it gradually shifts to cleaner fuels.