Australian mining giant BHP Billiton is planning to divest its existing coal assets and halt certain high-cost operations in order to cut costs and raise productivity.

The company said in a presentation released for an analyst visit to its mines in the state of Queensland that it will selectively carry out asset divestment opportunities with a prime focus on value.

BHP Billiton coal chief Dean Dalla Valle said in the presentation that the company will spend significantly less in development and exploration in the next year with no new major mining projects planned, a move which will result in a considerable rise in free cash flow.

In February 2013, BHP said it is seeking to sell the Gregory steelmaking coal mine in Queensland, following the closing of a part of the project amid low prices in 2012.

The company also announced its plans to divest nearly ten of its assets across its portfolio due to increase in debt levels, in March.

BHP believes that China will remain the largest importer of coking coal, although majority of the country’s future demand is expected to be met by domestic mines.