The coal assets of Whitehaven are not as low on the cost curve...

The coal assets of Whitehaven are not as low on the cost curve as Bengalla from what I've read. We will get a lot more transparency around Bengalla after the transaction is finalised. Up until that point there would be confidentiality requirements as Rio (like any other multi asset company) will not want their competitors having detailed information on an asset by asset basis.

As for the price. Until we see the cash it generates and its breakeven point, it is difficult to know. However I'm of the opinion it would have been a fair price based on reasonably conservative assumptions. Rio was not a distressed seller, but at the same time was looking to exit coal, and it is a depressed coal market with relatively few buyers having the balance sheet and the appetite for such a purchase. Using that as a basis, it is likely they would have agreed to a fair price.

Whether the timing was good, as always, will only be known in hindsight. We know without doubt that it wasn't a terrible time to purchase (that would have been 4-6 years ago). We also know without doubt that coal has been in a prolonged bear market for several years now, and that a lot of worldwide production is loss making. Around half of US coal producers debt is now in default, and some of their biggest miners are in bankruptcy. The supply is very slow to come out of the market, even when the US companies are in bankruptcy, it can be a long time before a mine is closed. Additionally there has been an increase in the use of gas fired power generators. It could be a slower turnaround than I initially thought with coal, however I do still think it will turn around, and we are probably reasonably close to that point. The natural depletion of mines as well as gradual closures will at some point reduce supply enough to increase prices. Also there will not be a rapid response to an increase in prices when it happens, with most coal mining companies on their knees.

Overall yes I think their timing is pretty good, and they probably paid what will turn out to be a good price over the longer term. They could sell it in 10-15 years when prices are much higher, wait for the next crash, buy again. They can also use the cashflow from Bengalla and their balance sheet to gradually buy up coal mines selling at bargain prices, which is likely to continue happening over the next couple of years.